revista presei pe energie 3 noiembrie – part III


ITAR TASS: European commissioner invites Russia to EU energy strategy drafting

Russian Deputy Prime Minister Igor Sechin met with European Energy Commissioner Gunter Oettinger on Tuesday to discuss preparations for the tenth conference of the Russia-EU energy dialog and the conference agenda, a source at the Sechin office told Itar-Tass.

Oettinger suggested to broaden cooperation and invited Russian specialists to take part in the drafting of the EU energy strategy for the period until 2050. He said the strategy would take into account interests of the partners and Russia’s energy expertise.

The sides affirmed sustainable energy cooperation. Foreign companies own 25% of Russian fuel and energy sector, which makes the sector one of the most globalized industries in Russia, Sechin said.

Hence, the Russia-EU energy dialog has special significance, the vice-premier said.

ITAR TASS: Russia’s natural gas output up 14% in Jan–Oct – Energy Ministry.

Russia’s natural gas output rose in January–October by 14.2 percent to 527.1 billion cubic meters, and the export of gas, by 17.6 percent in comparison with the same period in 2009, the Energy Ministry said on Tuesday.

Domestic gas consumption increased by 16.4 percent to 389.1billion cubic meters.

As for Russia’s oil and gas condensate output, it rose by 2.4 percent to 420.2 million tons, but Russia’s oil export decreased by 0.4 percent to 205.244 million tonnes.

According to the economic news agency PRIME-TASS, coal production increased by 7.9 percent to 260.8 million tons in January–October in comparison with last year’s results.

The overall supplies of Russia’s coal increased by six percent to 241 million tonnes, but export decreased by 0.2 percent to 81.3 million tons. Ukraine looking for further gas discounts

Prime Minister Putin has discussed creating a Russian-Ukrainian commission to review gas supply contracts to Ukraine according to Ukrainian Prime Minister Nikolay Azarov.

He says that the Russian government is also considering a discounting on gas for Ukraine in 2011, adding that each thousand cubic metres could cost Ukraine $30 less in the first quarter of next year.

“The price for 1 thousand cubic meters of Russian gas will cost Ukraine $230-235 in the 1 Q 2011.”

Under the 2009 agreement between the two nations gas supplied to Ukraine this quarter (4Q 2010) is costing Ukraine $252 per cubic metre, and the formula used would place prices during the first quarter of next year at about $260 per cubic metre.

Experts say a further discount could save Ukraine up to $360 million adding that savings will depend on the purchase volumes.

Ukraine Prime Minister Nikolay Azarov said earlier that the formula used to calculate the price of gas from Russia is unfavorable for Kiev and ignores the market volatility.

“The acting agreement can not suit Ukraine. Market realities have changed, thus the underlying value and the formula for determining the price have to be revised.”

Russia has already lowered the basic price for Ukraine 3 times, but Aleksey Makarkin, Deputy Director of the Center for Political Technologies, says Ukraine can not count on a revision of the 2009 agreement.

“Russia is not interested in losing its influence, a new discount is only a friendly sign to avoid conflicts.”

Novinite: Bulgarian PM Disses Burgas-Alexandroupoli Pipe on Eco-Grounds

Bulgarian PM Boyko Borisov has reiterated his scepticism of the feasibility of the Burgas-Alexandroupoli oil pipeline, amid strong indications that he is warmly embracing other energy projects with Russia.

The main motive Borisov pointed out for his reluctance is once again the environmental concern of the project.

Over the summer, the Bulgarian PM has been repeatedly pressing his worry that unloading tonnes of crude oil in the Burgas Bay could lead to a catastrophe similar to the Gulf of Mexico spill.

Although initially Borisov was disinterested in the other two energy projects withRussia – the South Stream gas pipeline and the Belene NPP – he has since considerably softened his stance of both, while remaining lukewarm to the Burgas-Alexandroupoli pipe.

In an interview for ITAR-TASS Tuesday, Borisov reiterated he is fully backing both Belene and South Stream, but not Burgas-Alexandroupoli, given the environmental concerns.

The oil pipeline, some 280 km long, is projected to join the Bulgarian port of Burgas to the Greek port of Alexadroupoli to deliver crude oil. It is claimed that this will result in an easing-up of heavy tanker traffic passing through Turkey’s Bosphorous strait. At Alexandroupoli, the oil will then be loaded onto new tankers and shipped to its destination.

Through Bulgarian territory, the pipe is projected to pass very close to theStrandzha Nature Park, a Natura 2000 protected area hosting dozens of endemic species and wild habitats.

Bulgarian PM Borisov has multiple times pre-empted the environmental impact assessment currently underway, stating that there is no possible way it can be positive.

Russia and Greece, on the other hand, have shown an extremely strong interest in actually building the pipeline and have consistently tried to press and convince Bulgaria into supporting it.

Novinite: ITAR-TASS: Bulgarian PM Enthusiastic about Belene NPP

Bulgarian PM Boyko Borisov has stated in an inverview for ITAR-TASS that he is “wholeheartedly” backing the controversial Russian-sponsored Belene NPP project.

This news comes only minutes after it was revealed that Russian PM Vladimir Putinis coming to Bulgaria to discuss key matters of mutual economic interest for the two countries.

That includes the three major joint energy projects that the Bulgarian government under Borisov has been chronically ambivalent about: the South Stream natural gas pipeline, the Bourgas-Alexandroupoli oil pipe, and Belene NPP.

”I view the building of Belene NPP as extremely important, for otherwise by 2020 Bulgaria will be having serious problems with electricity production, while neighboring Turkey will already have four NPPs at its disposal,” said the Bulgarian PM Tuesday.

Borisov caused a strain to Bulgarian-Russian relations over the summer when he issued various statements to the effect that his country is not particularly interested in Belene or South Stream. But that was only to warm up some weeks later following a visit to Sofia by Russian vice-PM Viktor Zubkov.

Tuesday Borisov also supported the South Stream pipe as favorable for Bulgaria.

This information comes only a day after the Russian paper Nezavisimaya Gazeta published a large article claiming that Borisov has ruined the geopolitical position of both Russia and Russian gas giant Gazprom in the Black Sea region.

Novinite: Borisov, Putin with New Phone Talks on Energy

Bulgarian Prime Minister Boyko Borisov and his Russian counterpart Vladimir Putinhad a telephone conversation Monday.

The information about the conversation was released, as usual in similar instances in the past, first by the press service of the Russian government, while the Bulgarian government will probably publish an announcement on Tuesday.

The Russian government statement says, as cited by Interfax, that Borisov and Putin “exchanged opinons on current matters of trade and economic cooperation by placing an emphasis on the energy sphere.”

They have also talked about future meetings of representatives of the two governments.

The conversation most likely referred to the fate of the three joint large-scale energy projects – the Belene nuclear power plant, the Burgas-Alexandroupolis oil pipeline, and the South Stream gas transit pipeline.

All of those have stalled to a different degree since the coming to power of the Borisov government which has made certain demands for the Russians, which appear to be much stronger than any conditions the Stanishev government might have set.

The conversation between Borisov and Putin occurred on the same day as the Russian paper Nezavisimaya Gazeta published a large article claiming that Borisov has ruined the geopolitical position of Russia and Gazprom in the Black Sea region.

Novinite: Bulgaria’s Borisov Ruins Gazprom’s Geopolitical Stand – Russian Expert

The geopolitical situation for Russia and its energy giant Gazprom in the Black Searegion deteriorated sharply after Boyko Borisov became Bulgaria’s PM, according to a Russian paper.

In a sizable article released Monday, the Russian “Nezavisimaya Gazeta” focuses on Bulgaria’s importance for Russian energy projects in the Black Sea region.

The paper emphasizes the view that “none of the Black Sea countries could be deemed a reliable ally of Russia in the energy sphere in the long run.”

It declares that if the South Stream gas transit pipeline gets bogged down by unreliable partners, Gazprom might have to opt for construction a terminal for liquefied natural gas (LNG) on the Russian Black Sea coast that could prove to be a good alternative of the much more expensive pipe.

Bulgaria’s stand is seen as the main factor threatening the realization of South Stream.

“Even though the official statements report about the successful settlement of all issues on South Stream after the visit of the first Russian Deputy PM in Sofia in July this year, it is hard to believe that Bulgaria will become a full-fledged partner in the Russian project,” writes the Nezavisimaya Gazeta.

It mentions several reason for doubting Bulgaria’s honesty with respect to South Stream: first, Bulgaria agreed to go ahead with South Stream only after Gazpromstarted mulling an alternative route through Romania; second, Bulgaria is one of the most active participants in the competitive project Nabucco; third, the lack of perspective for construction of pipelines became clear from the Bulgarian stand against the construction of the Burgas-Alexandroupolis oil pipeline.

“All this on top of the fact that the previous Bulgarian government (i.e. the Stanishev government – editor’s note) could not be called anti-Russian and that the oil pipeline is economically feasible for Sofia. So Bulgaria, the most important unit of the South Stream project, also remains its weakest unit,” the author, Stanislav Pritchin, an independent expert, says.

He believes that despite all difficulties with Bulgaria on South StreamRussia has no alternative because its ties with Romania are not close and are complicated by the geopolitical rivalry between Moscow and Bucharest in Moldova. He is convinced that Romania will not replace Bulgaria as part South Stream. At the same time,Gazprom would not consider Ukraine as a possible route for the pipe.

Turkey is also no better option for Russia, according to expert because, in spite of some similar positions at the moment, the two countries are geopolitical rivals, says the NG article.

“If the Russian monopoly is trying to penetrate the markets of Southern Europe by going around the traditional transit countries Ukraine and Turkey, Ankara is just trying to become a key gas hub for the EU, locking in on all exports from Russian, the Caspian states, Iran and Iraq. On top of that, Moscow has a bad experience in its relations with Turkey for another underwater pipeline, Blue Stream, which has been used at half of its capacity because of price conflicts among the partners,” the author says.

He is convinced that South Stream, which might cost as much as EUR 25 B, is a risky investment, and cites estimates of RWE Supply & Trading predicting low returns on the investment.

The author is therefore a proponent of the construction of a LNG terminal on theBlack Sea coast despite the strong international competition. This is supposed to allow Gazprom to enter new markers in Western Europe and even Japan, India, China, and the USA.

He believes that South Stream should not be compared to North Stream, which links Russia to Germany, because of the latter’s several major advantages such as avoiding all transit countries.

The conclusion of the NG article seem to run counter to a recent statement by Russian “energy tsar”, Deputy PM Igor Sechin.

The South Stream gas transit pipeline is supposed to be ready by 2015. Its construction is expected to cost between EUR 19 B and EUR 24 B. It will be transporting 63 billion cubic meters of natural gas annually, or 35% of Russia‘s total annual natural gas export to Europe.

The South Stream pipe will start near Novorosiysk on the Russian Black Seacoast, and will go to Bulgaria‘s Varna; the underwater section will be 900 km long.

In Bulgaria, the pipe is supposed to split in two – one pipeline going to Greece and Southern Italy, and another one going to Austria and Northern Italy through Serbia, Croatia and Slovenia.

The project was initiated by Gazprom and the Italian company Eni, and the French company EdF is also planned to join as a shareholder. It is seen as a competitor to the EU-sponsored project Nabucco seeking to bring non-Russian gas to Europe.

As early as April 2010, Russian Prime Minister Vladimir Putin announced that the French company EDF will also become a partner in the South Stream project. Back then he said that EDF asked for a 20% share, which, if granted, will probably leaveGazprom and Eni with 40% each.

As early as April 2010, Russian Prime Minister Vladimir Putin announced that the French company EDF will also become a partner in the South Stream project. Back then he said that EDF asked for a 20% share, which, if granted, will probably leaveGazprom and Eni with 40% each.

At a recent meeting in St. Petersburg, Berlusconi and Putin welcomed the idea of having German companies join in as shareholders. There is no indication as to how the joining of RWE or some other German company would re-apportion the stakes.

The ownership of the RussianBulgarian joint company to build and manage theBulgarian South Stream section will be split 50-50%.

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