Officials from Austria, Hungary, Romania, Bulgaria and Turkey have agreed to build a €9bn gas pipeline from Central Asia to Europe. The Nabucco pipeline is intended to reduce Europe's dependence on Russian gas supplies.

The long-awaited project, which could be completed by 2014, had been delayed by Turkey's insistence that it get 15% of the gas passing through the pipeline at a discounted rate, an issue still unresolved at the time of signing.

In May the EU announced €200m funding and the European Investment Bank may finance up to 25% of the project. Political support increased following gas supply disputes between Russia and Ukraine (EE 06/01/06). In total, the EU imports about one-third of its gas from Russia.

No gas producers have yet committed to supply the pipeline. But it is hoped the signing of the transit agreement will bring about commitments from Azerbaijan and Turkmenistan, whose gas reserves tripled last year.