Gazprom terminates Saipem Turkish Stream contract

A Saipem pipelaying vessel

Saipem,  Italy’s biggest oil-and-gas contractor, has  lost its $2.2bn contract to lay the Turkish Strean gas pipeline under the Black Sea for Gazprom after the two companies failed  to reach an agreement on “many working and commercial issues” relating to the project, the Moscow gas exporter announced yesterday. Gazprom has kept Saipem’s gas-laying vessels idling in the Black Sea since since December after President Vladimir Putin abandoned original plans for a $45bn underwater  link to Bulgaria and on to the European Union as his ties with the region soured over the conflict in Ukraine.
Saipem had been awarded two contracts for the scrapped link worth $2.7bn and  had been due to start work on the new project in June. Gazprom  is believed to have been paying Saipem about $27.75bn  for its two pipe-laying ships and the Italian company (an Eni subsidiary) had an agreement under which it would  receive early termination fees if the deal was canceled, the company’s then-head Umberto Vergine said in February.

Source: rigzone