Gazprom, Eni disagree over South Stream role

By Alberto Sisto

ROME, May 7 (Reuters) - A dispute has erupted between Italian oil major Eni SpA (ENI.MI: Quote, Profile, Research) and Russian state-controlled Gazprom (GAZP.MM: Quote, Profile, Research) over the role Eni will play in the South Stream gas pipeline, an Italian government source said on Thursday.

The Gazprom-led project aims to bring Russian, Caspian and Central Asian gas to Europe and is a rival to the European Union-backed Nabucco pipeline, which aims to reduce European reliance on Russia for its energy supplies.

Eni and Gazprom are 50 percent partners in the company which is conducting feasibility studies for the pipeline, but the Italian oil and gas producer's final role in the pipeline has not been defined.

The government source said Eni wants to be able to market gas from the pipeline in the countries the pipeline will pass through but that Gazprom was only offering the right to bring gas into Italy and a role in managing the pipeline.

"The Italian group wants to enter into the second phase of the project, that of selling the gas in the countries the pipeline will pass through... the Russians are putting up opposition, the talks are, however, still fluid," the source said.

Eni did not want to comment. A Gazprom spokesman declined immediate comment.

The Italian Prime Minister Silvio Berlusconi and his Russian counterpart Vladimir Putin are slated to meet at Sochi in Russia on May 15.

A previous meeting in April, when a statement on South Stream was expected, had been cancelled because of the Italian earthquake in Abruzzo.