The deal was signed by the Russian industry and energy minister and the Greek development minister after negotiations between Russian President Vladimir Putin and Greek Prime Minister Kostas Karamanlis.
Putin said the South Stream project was by far the most viable, although its implementation "does not mean that we are fighting against any alternative projects."
"Our proposal is the most optimal and the most competitive of all," he said.
He added that during his negotiations with Karamanlis, the parties also coordinated further steps in implementing the Burgas-Alexandroupolis oil pipeline.
Putin said these projects "will help considerably enhance the energy security not only of the Balkans but also of the entire European continent."
The Greek section of South Stream will have an estimated capacity of 10 billion cubic meters of natural gas a year, the Russian industry and energy minister said.
"The agreement has set the volume of gas shipments via Greek soil at around 10 billion cubic meters of gas a year," Viktor Khristenko said
The South Stream pipeline is expected to pump 30 billion cubic meters of Central Asian gas to Europe per year. Serbia and Hungary joined the project, already involving Italy and Bulgaria, earlier this year.
Russia, Bulgaria, and Greece signed a memorandum on the Burgas-Alexandroupolis oil pipeline in April 2005. Once completed, the pipeline will pump 35 million metric tons of oil a year (257.25 million bbl), a volume that could eventually be increased to 50 million metric tons (367.5 million bbl).
