Europe’s bitter harvest – Nabucco myth or reality

Nino Arveladze

In the freezing days of January, there were two main subjects of discussion in Baku.
First, how to conduct referendum concerning presidential term multiplicity, or in other words Aliev will be elected as many times as he wishes. It is not hard to predict the outcome of the referendum. Meanwhile, Aliev is on journey in Europe, where he would speak at Nabucco conference held by Europeans suffering from Russian aggression. Then he would meet Armenia’s president in Davos, in order to discuss well-known facts. Both issues are closely related with Georgia. Despite great efforts, Europeans held a dull conference. The reasons of their gathering, new accomplishments and solutions to key subjects stayed unclear. Conference revealed no answers to the following challenges: involving Turkmenistan in the project, breaking Russia’s violent resistance, laying the pipeline on the seabed of Caspian Sea, defining Caspian Sea status, without regulating Iran’s position, which is against this issue. Moreover, Azerbaijan’s approach was rather neutral – it would think about this subject if they wish so. Azerbaijan is angry on Europeans as he has done everything for Europe, but what has he got out of it? Russia and Armenia deprive Azerbaijan of territories. In addition to Nagorno-Karabakh, they took away seven more regions. Shots are heard everyday and soldiers are dying. Europe says it will negotiate with them. About what? Will it politely ask Russia to return territories to Azerbaijan and march-off the Russian troops? Is it incredible? Will it negotiate with Russia about the fact that Armenians and Russian should not construct health resort in Shush region? I do not know what blindness is and what diplomacy is: president of Hungary was officially declaring last year, that Southern stream is optimal and essential project. Obviously, he was rubbing shoulders with Putin. Now he is speaking of Nabucco as the only and choiceless way. If Czech prime minister statements are to be trusted, they are not doing anything against Russia. Just not to make angry Mr. Putin. Despite hard winter, Europe is playing its usual role, when holding featureless conference for vague Nabucco project, as a response to US request. Europe is blind when dealing with the Russian tanks in Sachkhere and military bases in Gali.

2009 Nabucco conference details:

Forty years ago, in order to supply whole Europe with natural gas, passing thousands of miles from Siberia, it was delivered to Eastern Europe, Baumgartner – Vienna. Baumgartner remains Europe’s major gas centre. It connects rich with natural resources Russia and greedy for gas Europe. However, an air of energy revolution has reigned. Europeans have long ago perceived that the time of natural gas industry diversification has come.
Gasprom together with the Kremlin and Big Russia has already started another annual dispute against Ukraine. Ukraine is a transitive country in Europe’s gas supply industry, and in accordance with its government’s decision Ukraine stopped delivering gas to Europe. In 21st century, there was a great deal of talk among experts concerning energy security. It was clear from the start that Russia rich with natural resources would use its energy carriers as a political weapon and would try to satisfy its imperialistic ambitions. Nobody has doubts that the latest Russia-Ukraine war is bearing not only commercial nature. At the Soviet Union times, Ukraine was an infrastructural centre of gas. After Soviet Union disintegration, Ukraine was receiving the major portion of gas from Russia. However, 80% of Russian export is passing through Ukraine. Europe’s gas supply depends on the relations of these two countries. Russia does not approve Ukraine’s aspiration for joining NATO and intends to increase gas price for Ukraine from $175 to $450. Would it be correct to put the matter in the following way – Russia-Ukraine gas war or Russia-Europe gas war would be a more proper definition? Can it be true that Putin did not foresee Ukraine’s decision? Russia doomed Europe! Obviously, Europe suffers from depending on Russia in gas supply matters. However, it is more important what Europe is doing to find alternative sources of gas supply. Europeans call Russia an unreliable supplier, nevertheless they have no alternative. 2009 year’s crisis in Europe gas supply, especially in Western Europe, once again proved that gas supply diversification is a guarantee of consuming stability. Annually Europe is receiving 140-milliard cubic meter natural gas. In the judgment of Russia, Europe’s one of the most ambitious ideas is Nabucco pipeline construction. The pipeline would deliver 31 milliard cubic meters of gas from Caspian Sea through Turkey and Balkans to Austria. The idea of Nabucco appeared in 2002 and since then it occasionally becomes urgent in response to Russia’s imperialistic and aggressive steps. Since Russia-Georgia August war and Russia-Ukraine complicated dispute, Europeans hastened the plan. Georgia is playing a role of transitive country in Nabucco project. It is worth of mentioning that during Russia’s encroachment upon Georgia in August 2008, Europe did not forget Russian gas resources. However, it forgot one thing – if Europe does not take away small independent states from Russian clutches, if it does not intervene in solving the regional conflicts, then it would never reach enough energy independence. Energy independence by itself means economical independence. Europe is in the clutches of Russia. Correspondingly, in order to establish stability in Caucasus and Middle East it should fight eagerly and make great efforts in order to accomplish Nabucco pipeline project. Skeptic experts reckon that huge problem is related to Nabucco project. Project adversaries claim that European Union officials are confusing political, economical, business and energy basics. From their point of view, Nabucco project is a wrong step in overall pipeline development. “Usually, one should find a source first and then start constructing a pipeline. However, in case of Nabucco, everything is on the contrary”, declare the opponents. European Union foreign affairs’ analytic in energy aspects Pier Noel declares that this project is only in minds of Brussels bureaucrats and Nabucco construction is not a simple work. Two million tones of steel costing eight billion Euro is required for pipe installation from western borders of Turkey, through Bulgaria, Romania, Hungary, to Baumgartner, Austria-Slovakia border. This is not a weighty argument, as gaining the energy independence should worth the eight billion Euros for Europeans, considering the fact that steel price is decreasing on the world markets. On 27th of January, heads of the states interested in Nabucco project gathered on Budapest summit. Representatives of each country are willing to participate in the project. Bulgaria requested 250 million Euros from Gazprom, as it is one of the countries, who suffered damage from Russian-Ukrainian conflict.
Council of Europe invests 250 million Euros in Nabucco pipeline project that is the 3 percent of the total sum needed to accomplish the project. This is the first sign and real steps to the diversification of energy supply of Europe. European Investment Bank declares that it is willing to cover 25 percent of Nabucco project expenses that is approximately 2 billion Euros. Project participants signed a declaration charging them with strict obligations. European Union’s Czech president organizes “Southern passage summit” on 7 May of 2009 in Turkmenistan and Bulgaria. In the first half of 2009, interstate agreement will be singed. Nabucco pipeline is not only a strategic project but it is a guarantee of peace on the continent also. 3300 km. length Nabucco pipeline construction will be started in 2011, while natural gas stream will be pumped in 2014.
Lavrov declared in January that Nabucco gas supply is rather problematic. Azerbaijani Caspian Sea deposit, Shah Denis II is considered as the Nabucco main source of gas supply. Gas is expected there from 2013. However, in order to Nabucco start working 8 billion cubic meters of natural gas is needed, in other words quarter of pipeline pumping ability. Meanwhile Russia is manipulating with Nagorno-Karabakh conflict toward Azerbaijani. Project participants forget that according to the recent researches Central Asia and Middle East holds rich reserves of gas, therefore in a long-term perspective there should be no trouble in filling Nabucco pipelines. European Union representatives declare that Nabucco project increases market liquidity and competition on energy market in Europe.
Recently conducted audit in Turkmenistan in gas supply sector cheered up Brussels officials, as Turkmenistan doubled its source. Skeptics still reckon that it will take twenty years for Europe to manage without Gazprom and receive gas supply from Turkmenistan. German major electricity and gas company RWE AG executive welcomes Turkmenistan’s promising market and is willing of constructive cooperation in energy sector.

On 7 January, during his visit in Ashkhabad, Iargen Grossman declared that they are having big interests toward Turkmenistan. Grossman’s visit in Turkmenistan was preceded by statement made by German RWE and Austrian energy concern OMW concerning joint decision to establish Caspian Energy Company Ltd, which will monitor all those infrastructural decisions connected with Caspian region resources. European officials announced that Turkmenistan gas is pumped passing Southern gas passage from Turkey, through new export route to European Union countries. European media declares that Turkmenistan is ready to get involved in Nabucco project and is willing to supply Europe with 10 billion cubic meters of gas, nevertheless official Turkmenistan has not made a statement about it. European Union representatives say that Europe is trying to diversify gas import; besides that, gas-producing countries are attempting to diversify gas export routs. Some pessimistic prognoses are spread concerning replenishment of Nabucco pipeline from Iraq and Iran. Visit of Turkey’s prime minister in Brussels once again proved that some problems exist in Turkey-Europe relationship. Turkey is trying to exploit pipeline for its aims. Turkey is concerned by Cyprus unsolved problems and applies for membership in European Union. Via negotiations, it tries to turn Turkey into main transitive country. Turks insist on 15 % discount on gas price. This demand can result Nabucco financial failure, declare Brussels officials. Iran’s oil minister Gulam-Husein Nozari warned Austrian energy giant OMV that if it does not sign an agreement in the nearest future Teheran would start searching another partner. Iranian minister declares that beforehand negotiation time is up and now it is time to act. “Iran cannot wait Nabucco forever!” says the minister. OMV is one of the six participants involved in complicated Nabucco project. The rest project participants are MOL – Hungary, Transgaz – Romania, Bulgargaz – Bulgaria, Botas – Turkey, RWE – Germany.
In January 2008, Iranian Minister of Foreign Affairs stated that Teheran is preparing for supplying the Nabucco pipeline. While oil minister discusses the project future optimistically and declares, that Europe needs Iranian natural gas in order to become energy independent. Negotiations about Nabucco pipeline project are not going easy. Europe refuses to back down. Meanwhile Russia demonstrates its powers in the world. Experts are expecting new economical order, in the issue of existing economical recession. From which direction should we expect world’s new ruler? Europe is fighting for first place and it needs strong Russia in this fight for supremacy against USA. Maybe, this is the way to explain veto on Georgia’s membership in NATO. Meanwhile, Russia forbids other countries to sell weaponry to Georgia. It demands UNDP mission in “Abkhazia and in the meantime Europe is blind. European supremacy is still a cliffhanger. However, it is obvious that Europe is reaping as it has sown by indulging Russia. This is only the beginning!