AFP - Russian Prime Minister Vladimir Putin won another victory for his strategy of energy diplomacy in France on Friday, signing a deal bringing French investment to a pipeline project.

The accord hooks another Western power into Moscow's plan to build two huge undersea gas pipelines to European markets, bypassing former Soviet satellites in eastern Europe and increasing Western reliance on Russian fuel.

It came on the second day of a working visit to Paris which has rattled France's EU partners in eastern Europe, amid reports that Russia will buy a French-built warship designed to launch amphibious ground assaults.

"An accord has just been signed between EDF and Gazprom on the entry of the French company in a great international transport project, the construction of a gas pipeline under the Black Sea," Putin told a meeting outside Paris.

According to a French source, French energy giant EDF will take a 10 percent stake in the project, which is designed to pump gas from central Russia into Italy and southeastern Europe, bypassing Ukraine and Belarus.

In addition to reducing Russia's reliance on export pipelines through local rival Ukraine, the South Stream project is a competitor to an EU-backed project known as Nabucco to pump gas from Central Asia through Turkey.

Italy's ENI is already a partner in South Stream, while German firms are working with Russia on a second pipeline, Nord Stream, that connects Russia to European gas markets under the Baltic Sea, again bypassing eastern Europe.

The French energy giant GDF-Suez confirmed it had held talks during Putin's visit to buy a nine percent stake in Nord Stream "which should contribute to the continuous strengthening of cooperation between Gazprom and GDF-Suez."

Putin made his announcement during talks outside Paris with executives from EDF, GDF-Suez, Total and Gazprom, France's Prime Minister Francois Fillon, and Finance Minister Christine Lagarde.

Officials confirmed he had discussed the warship deal on Thursday at a private dinner with Fillon, but insisted the main purpose of the trip was to seek agreement on the pipelines and the auto industry.

Moscow wants to buy a French-built helicopter carrier, a move that would mark an unprecedented transfer of naval technology from a NATO power.

"It's being discussed in general. It's a framework exchange of views. We're at the state of gathering information," said a member of the Russian team.

The arrival in St Petersburg this week of the Mistral, a French naval command vessel of the class that Putin hopes to buy, has increased concerns that Russia is seeking to project its might beyond its borders.

The Mistral is a 21,000-tonne, 200-metre (650-foot) amphibious assault ship that can carry heavy-lift helicopters, landing craft, tanks and up to 900 commandos. It is the second largest vessel in the French fleet.

In August, Russia said it would end a long-standing policy of building its own warships and buy a copy of the French ship. Russia could also build four more identical ships under licence from the French.

On Wednesday, Lithuania joined fellow EU and NATO members Latvia and Estonia in expressing concern. All three won independence in 1991 on the break-up of the Soviet Union and still have tense relations with Moscow.

Another country feeling abused by France cosying up to Russia is Georgia, the EU and NATO candidate state in the Caucasus that fought and lost a short but fierce war last year with Russia over two breakaway regions.

Georgian expatriates and sympathisers plan to demonstrate in Paris during Putin's visit, and on the eve of the talks Georgian Foreign Minister Grigol Vachadze expressed grave concern at a Paris seminar.

"He said the only theatre where these Mistrals could be deployed is the Black Sea, which to him represents an obvious threat for Georgia and Ukraine," said Thomas Gomart of the French Institute of International Relations.

The leaders also discussed the fate of indebted Russian car maker Avtovaz.

France's Renault currently holds a 25-percent stake in Avtovaz but Putin warned last month that its stake could be diluted unless it stepped up its investment in the failing firm, which produces the iconic Lada.

Reports suggest Renault and Lada are planning a share swap that would increase the French firm's stake, and Renault confirmed that it expected to sign a deal on Friday during Putin's visit, without giving details.

"Renault-Nissan will take part in the stabilisation of the (Avtovaz) factory," said Dmitry Peskov, Putin's spokesman.

The delegations were due to make announcements later on Friday.