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Message: Nabucco gas pipeline gains steam...
Nabucco gas pipeline gains steam
| Written by Robert Hodgson |
| Tuesday, 27 January 2009 |
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In 2007, the Hungarian Prime Minister Ferenc Gyurcsány ruffled feathers in Brussels by signing up for a new Russian gas pipeline project called South Stream during a visit to Russia in February of that year. Eurocrats were riled because Gyurcsány described the EU's own pipeline project, Nabucco, as a dream. "You cannot heat homes with dreams," he said.
 Now, as the region counts the economic and political cost of the recent Russia-Ukraine gas crisis, Gyurcsány is among those most vocally championing the Nabucco pipeline. This week Hungary hosts an international Nabucco summit, to which Azerbaijani President Ilham Aliyev, Bulgarian Prime Minister Sergei Stanishev and the heads of the EBRD and the European Investment Bank have all accepted invitations. The European Union receives a quarter of its natural gas from Russia, and 80 per cent of that is piped through Ukraine. As a relic of the Cold War era, most of the Russian gas imported to the EU is used by the new member states of Central Europe. Hungary receives about three quarters of its gas either directly or indirectly from Russia. Other countries, such as Slovakia, Bulgaria and Serbia, are almost entirely dependent on Russian gas, and were in a state of emergency earlier this month. However, the effects of the shut down of supplies last week were even felt to some extent in France and Germany. The project The EU has been talking about the need to increase energy security by diversifying supply routes and sources for years. The sense of urgency increased in 2006, when Russia cut supplies to Ukraine in a dispute almost identical to the one this year, but still the Nabucco project remained on the drawing board. The idea for a pipeline from Central Asia to Austria was hatched during talks between Austria’s OMV and Turkish Botas in 2002. Now six energy companies – Botas (Turkey), Bulgargaz (Bulgaria), Transgaz (Romania), MOL (Hungary), OMV (Austria), and RWE (Germany) – are part of the consortium behind the planned pipeline. The 3,300 kilometre gas pipeline will cost an estimated EUR 7.9 billion, according to project company Nabucco Gas Pipeline International GmbH. Pain brings gain There are signs that this latest gas supply crisis is increasing the political will within the EU to address the problem of financial backing. After a visit to Budapest in December, the Turkish trade and energy commissioner accepted a Hungarian proposal to set up an international advocacy body to pressure politicians to back the fast implementation of the Nabucco project. Now it looks now as though Russia and Ukraine might have done more in three weeks to persuade EU leaders of the urgent need to diversify gas supplies than a Nabucco lobbying body could have achieved in months. “We must not allow ourselves to be placed in this position in future. The message I will take to the March European Council is that now we have to be serious about diversifying and investing in Europe’s energy security future,” the European Commission President José Manuel Barroso said last Wednesday. At the Budapest summit, delegates will discuss the most difficult issues surrounding the Nabucco plan: raising the estimated EUR 7.9 billion needed to build it, and securing the gas supplies – 31 billion cubic metres per year, or five per cent of the EU’s current requirements – to fill it. Azerbaijan, Turkmenistan, Iran, Iraq and Egypt have all been mentioned as possible suppliers, but geopolitical and security issues muddy what would otherwise be a simple question of supply and demand. South Stream In the meantime, Russia is also courting the governments of Central Asia with a view to piping their gas into its own planned South Stream pipeline, which would run from Russia to Italy through the Balkans and is seen by the EU and the US as a rival to Nabucco. Liquefied natural gas Last Thursday Gyurcsány met Qatari Minister of Energy Abdullah Bin Hamad Al Attiya in Doha and discussed transporting liquefied natural gas (LNG) to Europe. MOL, OMV and Croatian oil company INA plan to build a terminal on the Croatian island of Krk with Qatari LNG. Croatia and Hungary held talks last year on connecting their gas pipeline networks, possibly by 2010 or 2011 with the LNG terminal in mind. http://www.budapesttimes.hu/content/... |
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