Russia and Ukraine have agreed to secure the flow of natural gas into Europe for the next five years. A deal between the two countries satisfies the economic needs of all three parties involved. Russia guarantees the export of its gas, Ukraine continues to benefit financially from transiting the gas, and the EU receives a steady supply of gas for the immediate future.
Gazprom, the Russian gas monopoly, will pipe 65 billion cubic metres of gas into Europe in 2020. The amount will fall to 40 billion over the next four years. The agreement mentions the possibility of extending the contract by another ten years upon maturity.
Ukraine will receive up to $7 billion in transit fees, which would be around 5 percent of its national budget.
An agreement has not (yet) been reached on direct gas supplies to Ukraine. For the time being, it only stands to benefit financially.
Senators in the United States have approved sanctions against companies that are involved in building the Nord Stream 2 pipeline between Russia and Germany.
The sanctions, which President Donald Trump has yet to sign into law, are a last-ditch attempt to halt the pipeline’s construction, which the Americans argue will only increase Europe’s dependence on Russian gas and hurt Ukraine’s position as a transit nation.
After four years of construction, the Trans-Anatolian Natural Gas Pipeline (TANAP) has started pumping gas into Europe.
TANAP is part of Europe’s Southern Gas Corridor, connecting the South Caucasus Pipeline (completed) with the Trans-Adriatic Pipeline (still under construction). It aims to transport natural gas from Azerbaijan all the way through to Italy, where it flows into the European market.
Russia has started piping gas to China through a new pipeline, called Power of Siberia. After five years of construction, it will be able to send up to 38 billion cubic meters of gas to China per year.
Poland will not be able to meet the EU’s 2050 zero-emissions target without additional funds. In an interview with the Financial Times, the country’s chief energy advisor, Piotr Naimski, argues that the European Union needs to take its particular circumstances into account.
Poland’s extreme reliance on coal makes the goal to reduce net emissions to zero a tall order. Coal generates about 80 percent of Poland’s electricity. It also curbs its reliance on Russian energy, which is of geopolitical significance.
There is a political consideration as well. Mining unions are still strong in Poland. The industry has long provided well-paying jobs with a high degree of stability. Miners enjoy special retirement provisions. This makes them a powerful voting bloc. Read more “Poland Needs EU Support to Meet Climate Goals”
Frederick Studemann argues in the Financial Times that Germany’s Ostpolitik breathes its last in the Nord Stream 2 pipeline controversy.
Germany’s allies in Central European and North America have for years argued against the extension of the Baltic Sea pipeline, arguing — correctly — that it is a political project for Moscow. It doesn’t need the extra capacity. It wants to cut its dependence on Russia-wary transit states in Eastern Europe, most notably Ukraine. Read more “Germany’s Nord Stream Climbdown Should Put Ostpolitik to Rest”
The Dutch Caribbean have been caught up in a legal dispute between the American oil company ConocoPhillips and the government of Venezuela.
A judge has allowed Conoco to seize Venezuelan-owned and -operated refineries on the islands in order to collect $2 billion in compensation awarded by the International Chamber of Commerce for the 2007 nationalization of Conoco assets in the socialist-run country.
Poland’s antitrust watchdog has begun legal proceedings against Gazprom and the five European companies that are its partners in Nord Stream 2. The regulator alleges that completion of the Baltic Sea pipeline would inhibit competition.
Located between Europe and the Middle East, Cyprus has historically been of strategic significance to powers on either side of the Mediterranean Sea. The discovery of natural gas off its shores has raised the island’s geopolitical profile — and might help it overcome communal tensions.
Cypriot waters are estimated to contain between 140 and 220 billion cubic meters of gas with an approximate value of €38 billion.