By Stephen Fidler in Davos, Switzerland and Gabriele Steinhauser in Brussels
Russian plans to build a new pipeline through Turkey and bypass
Ukraine as a transit country for shipping gas to the European Union
won't work, the EU's energy chief said on Thursday.
In an interview with The Wall Street Journal at the World
Economic Forum in Davos, Maros Sefcovic said the capacity foreseen
for the project, some 63 billion cubic meters of natural gas a
year, surpasses demand from potential customers, including Turkey
and South Eastern Europe.
"A first assessment is that this would not work," Mr. Sefcovic
said.
Russian President Vladimir Putin announced in December that
Moscow was dropping plans to build a big pipeline, known as South
Stream, through the Black Sea to Bulgaria due to disagreements with
the EU over control of the project. Instead, Mr. Putin said, Russia
and its state-owned energy company OAO Gazprom would pursue an
alternative transit route, provisionally dubbed Turk Stream, that
would deliver gas to the border between Turkey and Greece.
Gazprom has been eager to find new ways to ship gas to the
EU--its biggest foreign customer--that avoid Ukraine, whose
troubles with Russia have led to supply cuts in the past. That
ambition is shared by countries in South Eastern Europe, such as
Bulgaria, that rely on Russia and the Ukraine route for much, if
not all, of their gas supply. It has, however, raised concerns in
Brussels, where policy makers don't want to undermine Kiev's
remaining leverage against Moscow or fortify the EU's dependence on
Russian gas.
Mr. Sefcovic dismissed warnings from Gazprom's Chief Executive
Alexei Miller following a meeting between the two in Moscow last
week that the EU needed to start building pipelines to the
Turkish-Greek border "today" if it wanted to receive Russian gas
beyond 2019, when the company's contract with Ukraine expires. "I
believe the Russians will have to look at this option again and
come up with a viable economic solution that's also acceptable to
the European partners," he said.
Meanwhile, the EU is intensifying efforts to come up with its
own strategy to ensure energy supplies to countries in its South
East. Ukraine will announce on Friday that it can now import around
40 million cubic meters of gas a day from the EU, up from 31.5
million cubic meters until now, Mr. Sefcovic said. Ukrainian gas
company Naftogaz said on Thursday that just 33%, or around 500
million cubic meters, of the gas it purchased in December came from
Russia, a steep drop from 95% a year earlier.
To ensure that shipments from Russia to Ukraine continue beyond
an EU-brokered deal that expires at the end of March, negotiations
between the two sides should start very soon, Mr. Sefcovic said,
with experts kicking off talks before the end of January. "We are
ready to play this role of honest broker," he said, adding that
involvement by the European Commission, the EU's executive, could
help Kiev secure the necessary financing from international
financial institutions. Both the commission and the International
Monetary Fund are currently working on a new, multibillion aid
package for Kiev.
In February, the EU will also start work on a so-called energy
master plan for its southern, central and eastern member states,
Mr. Sefcovic said. On Feb. 9, meet energy ministers from the region
will meet for talks in Sofia, Bulgaria, followed later that week by
a visit to Baku, Azerbaijan, an important alterative supplier for
the EU.
At the end of February, the commission will publish its vision
for what he called an energy union, Mr. Sefcovic's main project for
his five-year term, along with a draft plan for building pipelines
between EU member states. Such "interconnectors" will allow gas to
be shipped between countries, similar to what Slovakia and Hungary
have been doing for Ukraine, and cut individual states' dependence
on single suppliers to supply routes.
"We are tired of being worried every summer if we would have
enough energy in the winter," Mr. Sefcovic said. "The biggest
economy in the world shouldn't have such a worry and the biggest
customer who pays EUR400 billion a year shouldn't be worried if
somebody will keep energy flowing when we pay for it."
Write to Stephen Fidler at stephen.fidler@wsj.com and Gabriele
Steinhauser at gabriele.steinhauser@wsj.com
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