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Analysis: Gas crisis forced a reluctant European Union to act
« on: 2009-01-10 01:12:47 » |
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[Fritz]More people struggling by the hand of politics and agendas
Source: Kyiv POST
Author: n/a
Date: 2009.01.09
VIENNA, Austria (AP) _ Just a few days ago, the European Union was doing its best to stay out of the natural gas standoff between Ukraine and Russia.
On Friday, it was deeply _ if belatedly and reluctantly _ involved: It dispatched observers to Ukraine as part of a deal aimed at getting the gas flowing back into the 27-nation bloc again.
EU monitors typically keep tabs on border disputes, not pipelines. But Russia's cutoff was seen by many as an act of economic warfare _ threatening millions of Europeans in the depths of winter.
Guaranteeing reliable energy supplies then came to be seen as a vital strategic interest. The EU seldom meddles in trade disputes between nations, and that's how it initially saw the showdown between Russia and Ukraine, the former Soviet republic through which the gas flows.
Russia cut off the natural gas it sends to Europe through Ukraine on Wednesday when a payment dispute escalated. Russia claims Ukraine siphoned off gas for its own use. Ukraine denies it.
But as gas supplies to at least 15 nations sputtered and finally stopped _ idling factories already struggling to cope with the global recession, and leaving millions without heat as winter's freeze seeped into their homes _ it became clear that this went far beyond bilateral bickering.
Many Europeans expected a quicker and more decisive response to a crisis that engulfed not only much of eastern Europe _ still heavily dependent on Russian energy _ but western nations including Austria, France, Germany and Italy.
"The EU has acted ridiculously slowly in this crisis _ not only unable to solve it but even to grasp its seriousness," lamented Lietuvos Rytas, Lithuania's largest newspaper.
It took Czech Prime Minister Mirek Topolanek, whose country holds the EU's six-month rotating presidency, to point out the obvious: Both Russia's and Ukraine's gas companies are state-owned. "Whatever they do," he said, "they don't do without political influence."
Translation: This was far more than a trade quarrel from the start. An almost identical dispute between Russia and Ukraine played out in 2006. Why, many Europeans want to know, hasn't the EU strengthened its hand by setting up a common European market in natural gas?
Although the EU as a whole has been steadily weaning itself off Russian energy since 1990, "a more integrated gas market would render EU members' bilateral relations with Russia largely irrelevant" in terms of gas supplies, the European Council on Foreign Relations said in a recent report.
Even though the gas would still come from Russia, a common market would make the EU a mega-customer, giving it far more clout with the Kremlin.
Others look to the proposed Nabucco pipeline _ a $5.8 billion, 2,050-mile (3,300-kilometer) conduit that, once built, would transport gas from Azerbaijan and Turkmenistan through Turkey and across the Balkans to central Europe.
Czech President Vaclav Klaus sees another way out: switching to nuclear power. "The point of departure," he said this week, "is to make possible the rise of nuclear energy."
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Where there is the necessary technical skill to move mountains, there is no need for the faith that moves mountains -anon-
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Fritz
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Re:Analysis: Gas crisis forced a reluctant European Union to act
« Reply #1 on: 2009-02-04 09:59:53 » |
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[Fritz]Interesting and sad saga as water and energy merge as an issue
Source: Radio Free Europe
Author: Farangis Najibullah
Date: February 04, 2009
Central Asia's Great Water Game
Apples are a valuable source of income for Khadija and her family in summer, but desperate times call for desperate measures.
With a severe shortage of energy supplies affecting all aspects of life this winter, she has decided the family orchard is best suited to provide firewood for the cooking stove that now serves as a main heating source.
"We are left in such misery. I cut branches of trees to burn in the stove. I wish prices were cheaper, at least," Khadija says.
With no supplies of natural gas and electricity usage restricted to one hour, prices for coal and firewood have skyrocketed, leaving Khadija and her fellow villagers in eastern Tajikistan's Rasht Valley with few options.
Variations of the theme can be told in much of Central Asia, where electricity shortages deprive millions of the luxuries -- and necessities -- that much of the world takes for granted.
But for mountainous Tajikistan and Kyrgyzstan, the solution is clear -- water.
Regional Meeting
It is with that in mind that the presidents of the two states headed to Moscow for summits of the Collective Security Treaty Organization (CSTO) and the Eurasian Economic Community (Eurasec) on February 4.
But the trip to the Russian capital also promises to highlight the sharp divisions that water and electricity issues have exposed -- particularly following recent comments by the Russian president.
Tajik officials blame Uzbekistan for their energy crisis, saying the neighboring country impeded the supply of imported Turkmen electricity that travels long power lines that run across Uzbek territory.
At the end of the day, it is up to Uzbekistan, Tajikistan, and Kyrgyzstan themselves to find a consensus
Seeking to take advantage of ample water supplies and mountainous terrain, Tajikistan hopes to complete construction of its Roghun hydropower plant and become an electricity exporter.
Kyrgyz President Kurmanbek Bakiev was in Moscow already on February 2 for a long-awaited face-to-face meeting with Medvedev, and walked away with promises of funding that could help complete the country's Kambarata hydropower plant.
And beneath the surface, Tajikistan and Kyrgyzstan both fear that Medvedev is siding with Uzbekistan, whose downstream position has led it to oppose Dushanbe's and Bishkek's hydropower ambitions on the basis that it would be left without water.
Medvedev's comments during an official visit to Tashkent on January 22-23 -- in which he said that any hydroelectric power stations in the region should only be constructed after taking into account the concerns of all neighboring states -- sounded alarms in Tajikistan and Kyrgyzstan.
The Russia Factor
Tajik authorities reacted most sharply, vowing to go ahead with its hydropower projects despite all objections. And while Tajik President Emomali Rahmon in the end traveled to Moscow to attend the two summits, planned meetings with his Russian counterpart were cancelled.
Russian and Central Asian media speculated that Moscow was attempting to improve its ties with Tashkent at the expense of its relationships with Dushanbe, often seen as Russia's most loyal ally in Central Asia.
Russian President Dmitry Medvedev (right) talks to his Kyrgyz counterpart, Kurmanbek Bakiev, in Moscow on February 3
Aleksei Malashenko, an expert at the Carnegie Endowment for International Peace in Moscow, says that while the dispute indicates Russia seeks to play an important mediating role in Central Asia, it actually "is demonstrating its inability to do so."
"Moscow is not capable of concretely formulating its position so that the two interested parties accepted it," Malashenko says.
"In my opinion, Tajikistan and Uzbekistan -- understanding that they cannot live without each other despite their differences -- would try to find new mediators that would act in new conditions. If it happens, it would be a step toward weakening Moscow's position in the region."
Andrei Grozyn, a Moscow-based expert on political issues, says Moscow's latest position forces Tajikistan to diversify its foreign policy instead of counting on Moscow as its major and most important strategic partner.
Grozyn says that, at the end of the day, it is up to Uzbekistan, Tajikistan, and Kyrgyzstan themselves to find a consensus -- "instead of telling Moscow 'choose me over my neighbor.'"
"Both Tashkent and Dushanbe in different ways but with the same persistence tell Moscow 'support only me.' It is not what Russia wants because in that case if Russia constructs Roghun, it would have to cancel other projects, including gas deals in Uzbekistan," Grozyn says. "And if it completely focuses on Uzbekistan, it would have to forget about all its economic interests in Tajikistan."
It is unlikely that Uzbekistan, Tajikistan, and Kyrgyzstan will resolve their water issues in Moscow this week.
Until the countries' leaders do find a common language, it will be ordinary people like Khadija and her children that pay the price.
As Khadija's teenage daughter, Gulandom, says: "These days you can't count on your government or on anyone else. You've got to find a solution to your own problems."
RFE/RL Tajik Service correspondent Salimjon Aioubov contributed to this report
Radio Free Europe/Radio Liberty © 2009 RFE/RL, Inc. All Rights Reserved.
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Where there is the necessary technical skill to move mountains, there is no need for the faith that moves mountains -anon-
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Fritz
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Re:Analysis: Gas crisis forced a reluctant European Union to act
« Reply #2 on: 2009-02-12 20:04:37 » |
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Very interesting dialogue, not that I think it is profound, just another view and info we tend not to get over here in the colonies.
Cheers
Fritz
Source: Der Spiegel
Author: Interview conducted by Jan Puhl and Christian Schwärgerl. Translated from the German by Christopher Sultan.
Date: 02/11/2009 04:53 PM
SPIEGEL INTERVIEW WITH RUSSIA'S ENERGY MINISTER
'We Cannot Continue to Waste Valuable Natural Resources'
In a SPIEGEL interview, Russian Energy Minister Sergei Shmatko discusses plans for joint ventures with German engineering multinational Siemens, secure shipments of natural resources to the West and rumors that Moscow wants to start a gas cartel modeled after OPEC.
A Russian gas production station in Siberia: Moscow wants to include the high costs of investment in new fields in future gas prices.
REUTERS
A Russian gas production station in Siberia: Moscow wants to include the high costs of investment in new fields in future gas prices.
SPIEGEL: The Russian government is courting Germany's Siemens Group in two areas: nuclear technology and energy efficiency. What do you hope to achieve?
Schmatko: In the booming nuclear business, we want to secure a fixed spot, together with Siemens, in the top echelon of the world's largest nuclear power suppliers. We should not be satisfied with third place. And greater efficiency is the largest and cheapest source of energy for our country. Conservation means cash. To achieve this, we urgently need German know-how.
SPIEGEL: The German government was initially surprised to see Siemens turn down France as a nuclear partner so that it could cooperate with Russia. How long have the talks been going on?
Schmatko: The thought, at least, is not entirely new. We have already installed Siemens' digital instrumentation and control technology in the Chinese Tianwan reactor. And we developed the WWER-640 reactor model with Siemens 10 years ago. At that time, German engineers were already testing and modernizing Russian nuclear technology. Personally, I favor a real joint venture, which offers a shared technology worldwide.
SPIEGEL: Some in Germany's Economics Ministry question whether the Russian technology is good enough for that.
Schmatko: Critics should take a look at how successful we Russians have been in the global nuclear market in recent years -- in China, India, Iran and now in Bulgaria. We are currently building seven reactors at home, which is more than any other country is doing. We expect to get know-how and the transfer of suitable technologies from Siemens. Then we will develop a project together that will also satisfy the critics.
SPIEGEL: Including a reactor in Germany?
Schmatko: Certainly not, given the current discussions there. We have deliberately avoided that. I could imagine a reactor near Kaliningrad (eds note: the Russian enclave located between European Union member states Poland and Lithuania) as a first project. The city is a good choice, because the region will face a power shortage after the planned shutdown of Lithuania's nuclear power plant. We are also very hopeful that things will progress for us in Bulgaria, the Czech Republic or Slovakia, as well as in many other countries. The demand is huge.
SPIEGEL: Will there also be limits to the joint venture with Siemens?
Schmatko: There are regions where this joint venture will proceed somewhat more cautiously. I am thinking about Iran, where we Russians have already built a nuclear power plant, which is scheduled to go into operation this year. This cooperation would continue without Siemens.
SPIEGEL: You promoted this project yourself once ...
Schmatko: ... because I am convinced that the power plant we are building in Iran does not lend itself to being misused for military purposes. This is why the Americans, for example, have also supported our involvement in this project.
SPIEGEL: But officially they criticized Russia sharply for this reactor project.
Schmatko: No. We kept them very well-informed of everything, and they were also involved through experts.
SPIEGEL: Why is Russia, with its enormous energy reserves, so interested in efficient technology?
Schmatko: Because we cannot continue to waste these valuable natural resources to such an enormous extent. Of the 640 billion cubic meters of natural gas we produce every year, we consume 400 billion ourselves. If we can manage to save up to 100 billion cubic meters of that by 2020, we will be able to sell the gas and at the same time spare ourselves the extremely costly development of new production areas in Siberia.
SPIEGEL: Why are you looking for partners in Germany?
Schmatko: During my student years in Marburg, I was impressed by how everything in the student dormitory was geared toward energy efficiency. Today an entire sector is developing around energy conservation. We need something like that in Russia. This is why we are now establishing a similar driving force at home, using the German Energy Agency as our model.
SPIEGEL: And to do so you are opening up the Russian energy market, which is normally so carefully protected, to foreign investors?
Schmatko: Gazprom is a sacred cow for us. We will not abandon the export monopoly for energy. But we are very open to competition in our country when it comes to energy conservation. German industry is highly advanced in this field. We are also in talks with Japan and Italy, but I think that German companies can develop a market in our country worth several billion euros a year, provided they act now.
SPIEGEL: For the time being, almost everything in Russia revolves around the production and sale of oil and gas. This was also evident in the high-stakes poker game with Ukraine. Was it worth it for Russia, interrupting gas deliveries to Europe and leaving hundreds of thousands of people in the cold?
Schmatko: That's very provocatively put. I cannot agree with your poker analogy. The issue was that Ukraine should pay a reasonable price for our natural gas and fulfill its obligation to guarantee safe transit for the gas to the West, as stipulated in the European Energy Charter. The European Union still has to make it clear to Ukraine that it, and not we, violated the Energy Charter.
SPIEGEL: But many people in the EU are furious with Russia.
Schmatko: Setting aside the fact that we disagree over who is at fault, we will definitely do everything, and I mean everything, so that this sort of interruption of deliveries will never happen again. To be honest, the events felt like a nightmare to me. Russia and Europe have developed a close and trusting relationship. We reliably supplied natural gas to Europe for 40 years, even under the difficult conditions of the Cold War. Of course, we do not simply want to gamble away this trusting relationship. That's why we had no motive to start the conflict.
SPIEGEL: What went wrong?
Russian Prime Minister Vladimir Putin (right) shakes hands with Siemens CEO Peter Löscher: "We urgently need German know-how."
DPA
Russian Prime Minister Vladimir Putin (right) shakes hands with Siemens CEO Peter Löscher: "We urgently need German know-how."
Schmatko: The early warning system with the EU, which was established within the framework of the energy partnership, didn't work. We should have implemented the measures that have been underway since mid-January earlier. If we had managed, in mid-December, to install international observers and a consortium for the so-called technical gas, none of this would have happened. We must learn our lessons from this quickly and work together even more closely.
SPIEGEL: What happens if Ukraine decides to stop payment again, perhaps because of the economic crisis? A repeat of the situation could quickly take shape.
Schmatko: No, I don't think so. The important thing is that the international observers remain in Ukraine. We are already hearing demands from Kiev that the observers be pulled out. That would be fundamentally wrong, from our perspective. The system has to prove itself first.
SPIEGEL: Is everything back to normal, now that the pipeline network is up and running again?
Schmatko: We are assessing that right now. For the first time in the history of this complex technical system, the natural gas flowed backwards in Ukraine. It was a decision made by Ukrainian specialists, and it was dangerous and even unpredictable. We were very concerned that something could happen.
SPIEGEL: Because of the interruption in delivery, the EU is seeking alternatives to Russian natural gas. Does this worry you?
Schmatko: We take a very pragmatic view of this. According to our own forecasts, Europe will consume about 620 billion cubic meters of natural gas in 2020. That's 100 to 120 billion cubic meters more than today. Our supply agreements are structured for the long term, so that our position as supplier to the EU over the next 25 years is not in jeopardy. To avoid transit risks in the future, we are building the new North Stream and South Stream pipelines. We are even investing in the liquid natural gas business, so that we can reach new customers for whom we cannot build pipelines. And we are also building pipelines in new directions -- to China, for example.
SPIEGEL: Is Russia in the process of forming a gas OPEC?
Schmatko: I don't know where this unfortunate term comes from. I chaired a meeting of the new Forum of Gas Producing Countries in Moscow at the end of December, and I wish to make it clear that Russia is not interested in agreements between countries regarding production volumes. We don't want a gas OPEC.
SPIEGEL: But an increase in the gas price was discussed.
Schmatko: That's something else. Russia is also seeking dialogue with the consuming countries over ways to include the high costs of investment in the development of new gas fields in the price. We would like to arrive at a fair price, one that is more stable than today's price and allows us to fulfill our long-term obligations.
SPIEGEL: Why didn't you invest more heavily in the infrastructure during the years of high gas prices?
SPIEGEL: Investments were made, but it wasn't enough. As gas prices rose, so did the prices of services, personnel and technology, making modernization more expensive. That's why we prefer to put a stop to his little speculative game with derivatives and other financial products relating to oil and gas.
SPIEGEL: And set the price as part of an agreement among the supplier countries?
Schmatko: No, not at all. Instead of a conspiracy among gas and oil producers, we need a new pricing mechanism -- one that is not based solely on supply and demand, but also on long-term investment needs. We would like to negotiate with Europe on this issue soon. Together, we should make ourselves more independent of irrational fluctuations in the markets.
Interview conducted by Jan Puhl and Christian Schwärgerl. Translated from the German by Christopher Sultan.
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Where there is the necessary technical skill to move mountains, there is no need for the faith that moves mountains -anon-
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Fritz
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Re:Analysis: Gas crisis forced a reluctant European Union to act
« Reply #3 on: 2009-02-21 20:02:12 » |
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A little story I didn't notice on the regular news. Clearly the captain did not remember what happened to a Korean B747 a few years back. I do admire the RUSSIANS FOR 500 ROUNDS AS A WARNING SHOT ACROSS THE STERN.
Cheers
Fritz
Source: Daily Telegraph
Author: Agence France-Presse
Date: February 19, 2009
BORDER guards in Russia repeatedly fired on a Chinese and Indonesian-crewed cargo ship that hit trouble off its Far Eastern coast, officials say, sparking concern in Beijing.
China called Russia to conduct a full investigation into the ship's mishap at the weekend, which resulted in the feared drowning of eight of the crew of 10 Chinese seamen and six Indonesians.
Officials said the ship, the Sierra Leone-flagged New Star, had left the Russian Far Eastern port of Nakhodka without authorisation after being sequestered there for smuggling, and repeatedly ignored warnings to stop.
"The investigation into the shooting on the foreign ship is being led by military prosecutors," Alexander Selentsov, an official from prosecutors in the Far Eastern city of Vladivostok, said.
"The captain of the New Star was repeatedly asked to stop through radio communication, lights, a flag and warning shots. But the foreign ship did not stop," he added.
He said border guards then received an order from the Federal Security Service (FSB) "to open fire on the ship".
"The order was carried out after warnings on the radio. Only then did the New Star stop and returned to the port of Nakhodka," he added.
The Chinese foreign ministry statement said its consulate in Russia has raised the issue with the Russian embassy in China.
It "called on the Russian side ... to quickly begin an investigation into the causes of the incident."
The Kommersant newspaper reported that 500 rounds were fired at the bow and stern of the vessel. The survivors claimed the firing caused the ship's problems rather than bad weather, it reported.
Interfax said that on its forced return to the port of Nakhodka the ship hit a storm, forcing its crew to disembark onto two eight-person rescue boats.
Russian border guards managed to rescue all the occupants of one of the rescue boats who were taken to hospital for treatment, Russian news agencies reported.
The other is believed to have sunk, with all of its eight sailors feared drowned.
A search for the missing is continuing.
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Where there is the necessary technical skill to move mountains, there is no need for the faith that moves mountains -anon-
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Fritz
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Re:Analysis: Gas crisis forced a reluctant European Union to act
« Reply #4 on: 2010-03-14 22:33:07 » |
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Another sign of the energy squabbles yet to come ....
Cheers
Fritz
Source: The Economist print edition
Author N/A
Date: Mar 4th 2010
Energy security in Europe Central questions
United in the cause of undermining Russian pipeline monopolies
BUDAPEST AND WARSAW
DOES “Central Europe” exist? It depends on the political climate. Amid worries that France and Germany are stitching up the European Union’s decision-making, the Czech Republic, Hungary, Poland and Slovakia are reviving their ties and pushing shared ideas on energy security and relations with the east.
The alliance began in Visegrad, a Hungarian town, in 1991, when even the EU’s waiting-room seemed distant. Once dreams of joining Western clubs became reality, co-operation all but dissolved. New members shunned anything that made them seem different from the rest. Squabbles, most recently over the treatment of ethnic Hungarians in Slovakia, dominated Visegrad meetings. Some even suggested winding the club up.
Not any more. At a summit in Budapest on February 24th Visegrad showed signs of renewed life. The big shift is in Poland, where go-it-alone policies have given way to enthusiasm for working with the neighbours. Under the voting rules of the Nice treaty, in force until 2014, Visegrad countries have as many votes in the EU as France and Germany combined.
Next year Hungary and Poland will each have six months in the EU’s rotating presidency. Eurocrats in Brussels like to portray the rotating presidency as largely redundant now there is a permanent European Council president. The Poles and Hungarians are working closely together to disprove this. Hungary wants a “Danube strategy” to divert EU money and attention to the river basin. Poland supports this, in return for Hungarian backing for more EU aid to countries such as Georgia, Moldova and Belarus.
The group is gaining allies. “Visegrad-Plus” adds some neighbours, largely from the former Austro-Hungarian empire. Most of these (especially the core four) depend heavily on Russian gas and oil. These are typically costly and come from clapped-out fields along ageing pipelines through unreliable transit countries, with unwelcome political conditions attached.
One way to change this would be to turn the east-west gas pipelines into a grid, with interconnectors running north to south. New Hungarian pipelines to Romania and Croatia will be finished this year. A Czech-Polish connector will open in the summer of 2011. An EU-financed Bosnian-Serbian link will be announced on March 5th. A second idea is coastal terminals in Poland and Croatia to import liquefied natural gas by tanker from countries such as Qatar. The third plan is Nabucco, an ambitious pipeline to connect Caspian and Iraqi gasfields to Europe via Turkey.
Visegrad is also pushing for EU rules on mutual help in energy crises. These could offer the region greater security. But big obstacles remain. One is Russia, which is intensifying its co-operation with friendly energy companies in France, Germany and Italy. On a trip to France, Russia’s president, Dmitry Medvedev, started formal talks on the sale of up to four Mistral-class warships, while France’s GDF Suez gained a 9% stake in the Nord Stream pipeline.
Russia also continues to push South Stream, a Russian-backed Black Sea pipeline. But it now has less backing than Nabucco. The new Croatian prime minister, Jadranka Kosor, visited Moscow this week and signed up to receive gas from South Stream. But Hungary and other countries have stiffened Croatian resistance to other Russian plans, such as the attempt to gain control of an oil pipeline from the Croatian coast to Hungary. That is a lifeline for Hungary’s energy company, MOL, which otherwise depends solely on oil from the east and is fighting attempts by a Russian company, Surgutneftegaz, to gain control.
The biggest problem is that energy security costs money. Gas interconnectors, for example, sound fine. But the extra competition they bring hits market share for companies used to cosy national monopolies. The Visegrad governments may gripe about west Europeans. But they have plenty to do on the home front.
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Where there is the necessary technical skill to move mountains, there is no need for the faith that moves mountains -anon-
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