One working group will be dedicated to preparing guidelines for a tender to conduct the pipeline’s feasibility study, while the other group will work on the shareholders’ agreement terms to be adopted by the corporation that will be created to run the pipeline.

The pipeline will run from Russia, under the Black Sea to the Bulgarian coast, where it will then split into two branches. The south branch will run through Bulgaria and Greece, and then a subsea portion will reach Italy. The second branch will divert northwards through Serbia and Hungary to Austria. In June, the proposed pipeline's capacity was increased from 31 Bcm/a of gas to to 63 Bcm/a.

The Bulgarian Government also said it will give priority to the 3,300 km Nabucco Gas Pipeline, which has already received European Union approval, but local news sources have said that Bulgarian Prime Minister Boiko said that Russia needed to clarify that the Nabucco and South Stream pipeline projects were not in competition with each other on Bulgarian territory.

“We are participating in both of them on an equal footing. The benefit for us is that the Russian gas is transited to the Bulgarian border and many of our neighbours join this project,” Mr Borissov said.