In a world of universal deceit, telling the truth is a revolutionary act, George Orwell

Indignez-vous ! Stéphane Hessel

“Le courage c’est de chercher la vérité et de la dire ; c’est de ne pas subir la loi du mensonge triomphant qui passe, et de ne pas faire écho, de notre âme, de notre bouche et de nos mains aux applaudissements imbéciles et aux huées fanatiques ”.” – Djordje Kuzmanovic

vendredi 19 juin 2015

Blog post: Gas wars - The winner takes (nearly) all

Gas wars - The winner takes (nearly) all

The Russian EU gas pipeline saga continues with some amazing twists & turns along the way. Add in political skullduggery & you’ll get just a small glimpse in the utterly underhand attitudes of certain EU members.  The latest Gazprom announcement made this week will
certainly be a tear-jerker for some very dumb politicians sitting in Sofia.

 “Sputnik reports: Russian energy giant Gazprom announced Thursday that it was intending to construct two a double pipeline from Russia to Germany through the Baltic Sea with E.ON, Shell and OMV.

“The memorandum demonstrates the intention of the sides to implement the project of construction of two strings of the pipeline from the coast of Russia through the Baltic Sea to the coast of Germany. The capacity of the new pipeline will be 55 billion cubic meters annually,” Gazprom said in a statement.”
If there are some to down to earth souls in Sofia, surely there should be some gnashing of teeth in anguish tonight.  Bulgaria would have been the first beneficiary of the Black Sea undersea South Stream pipeline,  with a planned capacity is 63 billion cubic metres per year (bcm/y). Bulgaria would have had gained with all of the transit fees perks attached to the project.  The South Stream project got scuttled by Russia, as a result of numerous political sabotage attempts by the EU Commission & some EU member states as well as behind the scenes US administration agitation.  This seriously damaged the project politically beyond repair. So President Putin had no other choice but to pull the plug on the project. Putin said: “We didn’t give up South Stream, we were not allowed to implement it.” One of these EU member states that threw away this financial opportunity was Bulgaria. Now Turkey has taken up this baton, through the planned operation of a Turkish Stream, with the European hub on the Turkish-Greek border.  Putin stated that if Europe “want our gas in 2019, they should start making appropriate arrangements to collect it from the Turkish stream hub right about now".

Turning back to the next planned phase of Nord Stream rev 2 & rev 3, once more the sole EU beneficiary& end user  of this is Germany.   We live in interesting times indeed, since the existing Nord Stream only operates just under half capacity.  This is due to the EU 3rd energy package, which states that 50% of the pipeline capacity has to be filled by a competitor. The EU 3rd energy package is considered to an anti-Russian trade barrier, as currently there is no other Russian competitor on the market.  Essentially, the two extra pipelines direct to Germany will most likely to be only used at 50% capacity as well.    That seems to be some fine & dandy footwork on the part of by both Gazprom & Germany to avoid breaching the 3rd energy package rules. Crazy as it seems, but this is a possible scenario.  Nord Stream is wholly Russian owned infrastructure, built & operated by Gazprom. Germany as the end-user of Nord Stream will not be allowed by Gazprom to re-sell the gas, if the Nord Stream Terms & Conditions are the same.

With Nord Stream increasing in capacity, with a potential total of 27.5 bcm, Germany takes it all & the other EU member states can squeal as much as they want, since many of them were denied the opportunity to take part in the South Stream, once Bulgaria got cold feet about the project, due to intransigence from the EU Commission.  Central European countries are looking into piggy-backing gas supplies from various sources, including the planned Turkish Stream.  The latest project being mooted is called Eastring. Another gas pipeline project touted is the "Tesla" project, the idea came about from a meeting in April 2015 of the  foreign ministers of Greece, Macedonia, Serbia and Hungary.  The stopping of South Stream not only seriously impacted the hopes of EU members in South-East Europe but also Bosnia, Macedonia & Serbia.

Previous background information  HERE


The political tone set by the EU:

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