The world's biggest natural gas exporter, Gazprom was joined by Eni, EDF and Wintershall in a consortium called South Stream Transport, which was set up to build the 931km underwater section of the pipeline.

Gazprom held a 50% stake in the project, which bit the dust earlier this month, but has since bought out the other companies for an undisclosed amount.

Russian President Vladimir Putin attributed the pipeline's cancellation to opposition from the European Union, which is wary of the gas giant's supply strangle hold on the region.

As South Stream hasn't signed any deals with banks yet, all investment and loans were to be provided by the partners according to their stakes.

France's EDF is reported to have spent €150 million ($A223.9 million) through the middle of the year, while Germany's Wintershall had previously based the future of its oil and gas unit on a partnership with Gazprom.

Both Eni and Wintershall have confirmed that the purchase price offered by Gazprom reimburses the companies for their capital invested to date.

Russia plans to build a pipeline to Turkey instead of the South Stream project, with Gazprom having already announced the creation of a company charged with its construction.