Gazprom CEO Alexei Miller that the implementation of the South Stream underwater gas pipeline project depends on gas talks with Ukraine.

Commenting on the prospects of South Stream’s construction in the context of the ongoing gas cooperation talks with Ukraine, Miller said: “South Stream has always been linked to Ukraine.”

Ukrainian President Viktor Yanukovych earlier described the current situation at the two countries’ talks on revising their gas contracts as difficult. According to his estimate, Ukraine’s pipeline system will be effectively devalued, both politically and economically, once Russia builds its South Stream and Nord Stream bypasses.

Serhiy Lyovochkin, head of Ukraine’s Presidential Administration, said that the country’s gas transport system will operate at a loss if the volume of Russian gas it ships to Europe falls below 60 bcm (2.12 tcf) a year.