RIA Novosti reported that Italy Eni SpA, which is Gazprom's partner in the Kremlin-backed South Stream gas pipeline project, proposed uniting it with its Nabucco rival to boost overall revenues.

Vedomosti quoted Mr Paolo Scaroni Eni CEO as saying at a Cambridge Energy Research Associates conference in Houston on Wednesday that if all the partners decided to merge the two pipelines for part of the route, we would reduce investments, operational costs and increase overall returns.

The paper said both South Stream and Nabucco aim to supply natural gas to Southern and Central Europe. The South Stream project is designed to deliver up to 63 billion cubic meters of Central Asian and Russian natural gas under the Black Sea while Nabucco is intended to pump 31 billion cubic meters of natural gas from the Caspian region via Turkey.

The paper said Russian experts, however, are skeptical about the prospects of merging the two pipelines as Nabucco was originally designed to cut Europe's dependence on Russian natural gas deliveries.

The paper quoted Mr Dosym Satpayev director of the consulting firm Risk Assessment Group, as saying "Russia will hardly agree to such a merger as Nabucco is lobbied not only by the EU but also by the US."

The paper said a Gazprom representative declined to comment on the information while an Eni spokesman was unable to explain the merits of the proposal, adding that explanations could appear on March 12 when the Italian company is to present a strategy of its development in 2010-2013.

(Sourced from RIA Novosti)