Loss of Ukrainian gas transit does increase the risk of military conflict. In October 2013, I came across an anonymous blogger’s note about Russia forming a separate air assault brigade to stop shale gas development in Eastern Ukraine . It was several months before the Ukrainian revolution of 2014 , and I dismissed the news as fake. However, after the start of combat activities in the Ukrainian provinces of Donetsk and Luhansk, the note made a lot of sense. Coincidentally or not, the gas supply system of Gazprom was ready for the war in Ukraine. For many years Rostov-on-Don and two more provinces of Southern Russia were receiving gas through Eastern Ukraine. In 2007, Gazprom commissioned a bypassing pipeline enabling “to directly supply gas to Russian
The German government is continuing to insist that the Nord Stream-2 is pure business, no politics. Having read the feasibility study commissioned by the Nord Stream-2 consortium and executed by Arthur D. Little in 2017, one should not second guess the real motives of both the Russian and the German governments – there is a list of jointly agreed countries that stand to gain and by extension that stand to lose. What is missing in the study is the list of countries that are bound to lose. The consultant has been asked to assess the economic impact of the project – “the activities and investments, related to the Nord Stream-2 project on those countries that are either directly involved in the project, or have contributed with materials or
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Last week deputies and members of the Energy Commission voted on the amendments to the Energy Act which launches the Balkan gas exchange, thus pushing the process of liberalization of the gas market. This belated action is due in part to the pressure from the European Commission as Bulgaria remains a blank spot on the EU gas market. The gas exchange and the trading platform are a key element in the overall concept of the Bulgarian gas hub, the crown jewel in the efforts of the Bulgarian government in the gas sphere over the recent years. The liberalization of the gas market is closely related to the existence of a trading platform and the goal of attracting sufficient gas liquidity for distribution through the “hub”. The
Once Russian gas is dried out in the Ukrainian gas transportation system the country is in trouble. Bulgaria and Poland may come to help, rather than Germany and Brussels. No one is guilty that on December 31, 2019 the current transit contract between Naftogaz of Ukraine and Gazprom of Russia ends. As the same time two highly controversial bypassing projects will soon become operational – North Stream-2 and Turkish Stream. That will end an era of the decades long Ukrainian gas transportation business of approximately 90 bcm per year from Russia to Europe and Turkey. Taking into account the hurdles the notorious North Stream-2 is facing the physical transit may not end completely but commencing on January 1, 2020 there will be no more long-term commitments on
Let us state the publicly known facts and try to assess the business merits of the deal. Bit by bit, slowly and systematically, so that even non-experts can understand. We have a standing valid gas transit contract between Gazexport and Bulgartransgaz, using the current Trans-Balkan Pipeline, until 2030 with “secure” revenues of $ 1.2 billion. This is not the total contract amount, just the ‘ship or pay’ segment, accrued until the end of the contract. This is regardless of whether Gazprom decides to end transit through Ukraine, to take up alternative routes through Turkey, Germany or the North Pole. Cash in hand. Or almost. Giving up on these receivables is a condition sine qua non, set by Gazprom, if we want to enter into the new venture
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As alluded to in previous analyses, there is a very diverse and intriguing picture behind the official results of the tender for engineering, procurement and construction of the Bulgarian section of Turkish Stream. A deeper look into the tender procedures would offer ample ground to reason that so far it has defied European standards for project development and management, being closer to the model Gazprom uses along the entire South Stream chain of projects from Anapa on the Russian Black Sea to the Baumgarten Hub. The original idea of engaging a Saudi company rests on the premise that, as a strategic ally of the United States, a company from the Saudi Kingdom could potentially “shield” Gazprom’s operation from Western and US sanctions. One can hardly anticipate that
This is the key line Russian President Putin used at the plenary session of the International Arctic Forum, which was instantly relayed by all Russian media, mainly by TASS, Russia Today and Sputnik. There is nothing new in this vintage Russian propaganda, which is echoed by pro-Russian politicians in the EU – Russian gas is indispensable and the cheapest gas in the world, while US-sourced LNG is expensive and inferior in quality. EU budgets, he asserts further, will have to compensate European consumers for the price difference between US LNG and pipeline gas from Russia. Even if one sets aside the basic fact that the budgets of EU countries and that of the Russian state are profoundly different in structure, the EU legal and regulatory bases make it