Greece and Italy sign deal on undersea gas pipeline

ATHENS, Jan. 31 – Greece and Italy signed an agreement Wednesday to speed up work on a pipeline between both countries to carry central Asian natural gas via Turkey to Western markets. Construction will start in June 2008, aiming for completion by 2011. The agreement will ensure the diversification of sources of supply of natural gas. The 212-kilometer pipeline goes between Stavrolimenas in northwestern Greece to Otranto, Italy, via a pipeline beneath the Adriatic Sea. The 300 million Euro link is one of a series of projects being promoted by the EU to reduce the 27-nation bloc’s dependence on Russian natural gas, most of which is now piped through Ukraine. The EU will fund up to 40 percent of the cost. The completed project would connect with a Turkish-Greek pipeline now being built between Karacabey, Turkey and Komotini in Greece, which should be operational by June 2007. Officials hope the completed Turkey-Greece-Italy link _ the Southern Europe Gas Ring project, costing over 1 billion Euro will make Greece an energy hub. Greece will import up to 11.5 cubic meters (406 billion cubic feet) of gas a year, exporting over 8 billion to Italy and retaining the rest for domestic and regional use. It also foresees exports to Albania, Macedonia and possibly Bulgaria, all signatories to the 2005 Energy Community Treaty for southeastern Europe.