/ world today news/ A new coalition of Gazprom’s allies is being formed in Europe, writes Kommersant on the occasion of the meeting of the foreign ministers of Greece, Serbia, Macedonia, Turkey and Hungary held in Budapest to consolidate their positions on supplies on gas. According to the publication, Austria may join them.
This is the result of the failure of the construction of the South Stream gas pipeline due to pressure from the US and the EU. So far, no Gazprom project has started in such a political format. The situation takes on a different meaning due to the fact that all members of the new “club” in one way or another are trying to conduct a policy independent of Brussels in other matters as well. But the European Commission, for its part, is preparing mechanisms to block the gas projects it does not want.
The participants of the meeting in Budapest discussed the participation of these countries in “Turkish Stream”. The Foreign Ministry of Hungary specified to “Kommersant” that a representative of the European Commission was present as an observer at the meeting. A declaration was signed on energy cooperation and creation of an “economically justified way to diversify routes and sources” for transporting natural gas from Turkey to European countries.
In this way, these countries actually confirmed their desire to participate in the project based on the route announced by Russian President Vladimir Putin during his visit to Hungary in February – from Russia, along the bottom of the Black Sea through Turkey to the hub in the Austrian city of Baumgarten . The project became an alternative to “South Stream”, which Gazprom abandoned in December due to resistance from the EC, which – with the support of the American authorities – put serious pressure on the participating countries, in particular Bulgaria / its role in the new project plays Turkey/. Each country and the “interested companies” will discuss the specific questions about their participation in the Gazprom project separately.
The Ministry of Foreign Affairs of Hungary specified that the representatives of the five countries agreed to hold regular meetings and create an expert group for the development of the gas transmission infrastructure. The group will deal with the issues of financing, gas prices and sources, and the involvement of third parties in the project. The next meeting at the ministerial level is planned for July, but the individual negotiations will start earlier and Greece will enter them first. The Prime Minister of the country, Alexis Tsipras, will meet with Vladimir Putin today, and the gas negotiations may become one of the key issues. Last week, Greece’s Energy Minister Panagiotis Lafazanis discussed reducing gas prices from 2016 and softening take-or-pay conditions with Gazprom chief Alexey Miller. According to Kommersant sources, if Greece confirms its participation in “Turkish Stream” “, the issue of reducing prices within 10% can be considered resolved.
If the parties manage to agree on the construction of the land part of “Turkey Stream”, “Gazprom” can solve the issue of supplying gas to Europe bypassing Ukraine, without fundamentally changing the existing agreements with consumers. But it’s not just about trade agreements: special relations with EU members Greece and Hungary and with membership candidates Macedonia, Serbia and Turkey are important for Russia amid the current sharp conflict with the West, insofar as these countries are trying to pursue an independent from Brussels policy, including and outside the supplies of Russian gas. And Austria can enter the new club of supporters of “Turkish Stream”, sources tell “Kommersant”, based on the fact that recently the head of the Austrian oil and gas company OMV became Rainer Seele, who for the past five years was at the head of Wintershall and, according to some estimates, earned a reputation as a “great friend of Russia and Gazprom”.
One of the key problems that the new coalition will have to solve is the financing of “Turkish Stream”. The logic behind the work on South Stream was that the Russian company builds the pipeline, attracts financing and owns the project. But access to Western money for Gazprom is difficult, and EU legislation does not allow companies to simultaneously own the infrastructure and deliver gas through it. For these reasons, Gazprom cannot participate in the construction of the new gas pipeline through the Balkans and Central Europe, as it did in the case of South Stream, confirms Jonathan Stern from the Oxford Institute for Energy Research. According to Kommersant’s sources, the Russian company is discussing the possibility of creating a European consortium that can take on the construction of the gas pipeline and, possibly, attracting European money.
“In connection with the creation of the Juncker Fund/the new investment fund of the EU with a volume of around 300 billion euros/, the appetite of the governments of the countries of Central and Eastern Europe for investments in infrastructure has sharply increased,” says a European diplomatic source. But while the framework of the consortium is only outlined, the EC will rather be against projects intended only for Russian gas. Now, as part of the creation of an energy union, the EC is preparing legal mechanisms that will enable it to block the conclusion of intergovernmental agreements and trade contracts if they are assessed as a threat to the EU’s energy security.
Moscow / Russia
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