The MoU specifies that EDF will enter the project by the end of 2010, with a share of no less than 10 per cent. This will be deducted from Eni’s stake in the project.

The agreement was made during the International Economic Forum held in St Petersburg, Russia, and has been sanctioned by Russian President Dimitri Medvedev and French President Nicolas Sarkozy.

EDF Chairman and CEO Henri Proglio said that the agreement will enable EDF to strengthen its position in the gas market.

“It enables the company to complete an important step forward in its gas strategy aiming to secure its supplies, both for supplying its own electricity production facilities and for selling natural gas to its clients,” Mr Proglio said.

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In addition, the document regulates the implementation process for offshore construction of the South Stream Gas Pipeline, and confirms the volume of gas that Gazprom will supply to Eni via the pipeline.

The South Stream Pipeline will travel 900 km under the Black Sea, transporting up to 63 Bcm/a of natural gas from Russia to South and Central Europe.