Eastern Companies, Politicians Voice Opposition to Nord Stream Expansion
Ukraine's Naftogaz and some Eastern politicians are converging on the firm belief that a stronger gas alliance between Russia and Germany might be detrimental for Europe's energy security.
On Thursday, Naftogaz CEO Kobolyev basically reiterated what Former Czech Prime Minister Mirek Topolanek recently told Natural Gas Europe: building a second line of the natural gas pipeline Nord Stream is an option carrying along threats for Europe.
NAFTOGAZ: MOSCOW, NOT BRUSSELS, WOULD DECIDE BETWEEN NORD STREAM, TURKISH STREAM
"The realization of Nord Stream-2 gas pipeline project agreed by Gazprom with E.ON, BASF/Wintershall, OMV, ENGIE and Royal Dutch Shell does not only undermine interests of Ukraine and Slovakia as key countries transmitting Russian gas to Europe. Another redundant pipeline controlled by Gazprom will increase the European Union’s dependence on Russia" Andriy Kobolyev, CEO of Naftogaz of Ukraine, said in an emailed note.
Kobolyev conceded that Nord Stream-2 and Turkish Stream would increase diversification of routes, but argued that Moscow would take the decision, while Brussels would remain with little power to influence Gazprom's moves.
“Both Nord Stream-2 and Turkish Stream pipelines provide additional choice, and more choice is a great thing. However, it is a great thing not for the European consumers but for their Russian supplier. It will be Russia that decides where, to whom and on which political conditions it is going to supply its gas in Europe,” Kobolyev said.
All in all, it remains unclear whether the declarations are meant to create a common front against Gazprom. For sure, they are a message to Russia's Vladimir Putin and European Commissioner Maroš Šefčovič.
'Russia has already attempted the first ultimatum of this kind in January 2015,when Alexei Miller, Gazprom’s CEO, confronted Maroš Šefčovič, Vice President of the European Commission in charge of the Energy Union, with a claim that Gazprom was going to supply gas via Turkish Stream instead of via Ukraine and Slovakia. This change of the traditional route would be made regardless of Europe’s readiness or wiliness to accept gas at the border of Turkey' reads the note.
Naftogaz argues that European countries and Ukraine should join forces to prevent construction of new routes of Russian gas delivery controlled by Gazprom.
'The more choices of gas delivery Russia has, the higher is its bargaining power in relations with the EU buyers. The Europeans would be in a much stronger position focusing on expansion of their own choices of gas suppliers.'
On August 27, representatives of the EU and Ukraine met in Vienna to discuss energy security matters and the re-commencement of trilateral discussions with Russia to ensure stable gas supplies to Ukraine and via Ukraine to the EU during the coming winter.
TOPOLANEK ASKS BRUSSELS TO PAY ATTENTION
Earlier this week, Topolanek, who sits on the board of the Slovak transmission system operator Eustream, said that Nord Stream 2 could 'potentially scuttle the North-South Gas Corridor project, which would connect European gas supply sources from the Baltic, Adriatic, and Black Seas to the rest of Europe.'
On Wednesday, Central Europe Energy Partner (CEEP) renewed its backing to the North-South Corridor, a set of interrelated energy infrastructure projects that would connect Central European markets.
Grupa Lotos, a vertically integrated oil company based in Poland, took part to the work presented by CEEP.
On Thursday, Slovakia’s Robert Fico and Ukraine's Arseniy Yatsenyuk basically said that the plan is a sellout.
In conclusion, it seems clear that there is a front of western companies willing to push forward the expansion of the pipeline connecting Russia with Germany, while politicians and companies from Eastern Europe are ready to equally table their requests. The interests of the two blocks are clearly diverging. If not carefully handled, that could be a problem, especially in a moment migrations and complex geopolitical moves are already fracturing Europe.
Sergio Matalucci is an Associate Partner at Natural Gas Europe. He holds a BSc and MSc in Economics and Econometrics from Bocconi University, and a MA in Journalism from Aarhus University and City University London. He worked as a journalist in Italy, Denmark, the United Kingdom, and Belgium. Follow him on Twitter: @SergioMatalucci