European Union authorities have asked Bulgaria to suspend work on Russian energy giant Gazprom’s South Stream natural gas pipeline.
It wants the project frozen pending a decision on whether it conforms with EU regulations on a single energy market.
The move threatens to inflame tensions between Moscow and Brussels.
The EU’s executive arm says it believes South Stream does not comply with its rules prohibiting gas suppliers from also controlling pipeline access.
It has sent the Bulgarian government a letter of formal notice asking for information. Sofia has one month to reply.
Depending on how it responds there could be full infringement proceedings and possibly fines.
The approval process was put on hold following Russia’s annexation of Crimea in March.
Bulgaria, however, has decided to start construction of South Stream as a national priority. The country is heavily dependent on Russian gas and wants to shore up its gas supplies.
On Thursday Serbia said it had no plans to delay the start of construction of its leg of the South Stream pipeline which is scheduled for July.
Energy Minister Aleksandar Antic added: “The position of Serbia is not decisive. We will follow developments and decide accordingly. I believe the European Commission and member states will find a solution because this is a European project in the best interests of energy security.”
Russia wants South Stream as a route bypassing Ukraine for shipping gas to western Europe.