Dr. Çetiner’s Blogs (Prof. Dr. Gültekin Çetiner)

Turkey to ‘Realize’ Nabucco Project Despite Tanking EU Support
BRUSSELS (Combined Sources)–Turkey will “realize” the Nabucco Pipeline project despite a recent confirmation by EU officials that the project, considered a flagship Union venture, had disappeared from the list of energy projects the EU’s economic stimulus plan will finance.

Nabucco– a 3,300km pipeline designed to carry Caspian gas to Europe via Turkey and the Balkans in order to limit EU’s dependence on Russian gas — fell off the list of energy and broadband projects that an EU stimulus plan would finance, Brussels-based EurActiv reported on Tuesday (March 17th).

EU foreign ministers discussed the 5 billion euro plan during a meeting Monday, but failed to reach an agreement over the list of energy and broadband projects. The EU leaders are expected to decide on the list in Brussels on Thursday.

Turkey, which has sought to use Nabucco to leverage its value as a transit hub for energy to Europe, said Tuesday it would “realize” the Nabucco project itself. “Small obstacles in big projects never prevent their realization,” Turkey’s Energy Minister Hilmi Guler was quoted by RIA Novosti as saying.

“We set the aim of completing Nabucco. If necessary, this should be done regardless of where the energy sources are located,” he added.

Czech Deputy Prime Minister for EU Affairs Alexander Vondra, whose country currently hold the rotating EU presidency, expressed hope Monday that EU members could reach an agreement. If so, the European Parliament can approve the stimulus plan before the end of its mandate. If not, everybody’s credibility will come into question, said Vondra.

The European Commission (EC) initially proposed providing 250 million euros to share the risk and help secure bank loans for Nabucco. That amount later shrank to 200 million euros.

In the latest version of the project list, a broader term, “Southern corridor,” appears instead of Nabucco. It includes different projects in southern Europe, including a new Interconnector Turkey-Greece-Italy (ITGI) pipeline between the Greek Ionian coast and Italy.

Romanian Foreign Minister Cristian Diaconescu has warned that his country will not vote for the stimulus package if it excludes Nabucco. Romania’s position has support from Austria, Poland and Slovakia, he said.

Similarly, Polish Minister for European Affairs Mikolaj Dowgielewicz said that Prime Minister Donald Tusk would try to convince EU leaders to back Nabucco to reduce the bloc’s dependence on Russian gas supplies.

The agreement on the Nabucco pipeline was signed in 2002. Planners expect completion of its first phase in 2014. Once fully operational, Nabucco will ship up to 31 billion cubic meters of gas per year to Europe via Turkey, Bulgaria, Romania and Hungary.

Observers expect Azerbaijan to become the project’s first gas supplier. Middle East countries may possibly join as suppliers later.

Germany, whose RWE has joined five other energy companies in the Nabucco consortium–OMV of Austria, MOL of Hungary, Bulgargaz of Bulgaria, Transgaz of Romania and Botas of Turkey–is one of the strongest opponents of providing European money for the project.

German Chancellor Angela Merkel recently said that the biggest problem Nabucco faced was not financing but finding gas to feed the pipeline.

Wednesday, March 18, 2009

Gazprom stands against Nabucco project
The Russian giant natural gas monopoly, Gazprom, was invited to join the European gas project Nabucco, but will decline the offer, remaining a supporter of the South Stream project. At the same time, Romania risks a delicate situation, since Nabucco seems to have lost its European support.

Gazprom vice president Alexander Medvedev declared in an interview for Vesti TV that Gazprom will focus on its own project, South Stream, and will not involve in the Nabucco project.

“Unlike Nabucco, we have everything we need to make South Stream become reality. We have the resources, the market, appropriate management and the experience required to implement complex projects”, said Medvedev, adding that the group is not ready to work on two projects simultaneously.

The South Stream pipeline was designed to carry 31 billion cubic meters of gas per year from Russia and Central Asia towards the Balkans and other European states.

Romania was hoping in the realization of the Nabucco project, worth 10 billion Euros, which was at first also supported by the European Union and the United States. Nabucco would connect Central Asia and Europe, via Azerbaijan, Georgia, Turkey, Romania, Hungary and Austria, by-passing Russia and Ukraine. The construction was first scheduled to begin in 2010.

On Monday, EU officials confirmed that Nabucco is no longer among the energy projects about to receive European financing.

Gazprom turns down invitation to join Nabucco project

MOSCOW (RIA Novosti) - Gazprom has received an invitation to join the Nabucco pipeline project to pump gas from Central Asia to Europe, but will not take up the offer, a deputy head of Russia’s energy giant said.

In an interview with Vesti TV on Monday, Alexander Medvedev said Gazprom would stick with its South Stream project and stay out of Nabucco.

“Unlike in the case of Nabucco, we have everything we need for this project

[South Stream] to materialize,” he said. “We have gas, the market, experience in implementing complex projects, and corporate management.”

The executive said Gazprom was not prepared to split its operations between two projects simultaneously.

“You chase two rabbits, you catch neither. We have a rabbit we know, and we will chase it,” he said.

The $10 billion Nabucco pipeline, backed by the European Union and the U.S., is intended to link energy-rich Central Asia to Europe through Azerbaijan, Georgia, Turkey, Bulgaria, Romania, Hungary and Austria, bypassing Russia and Ukraine. Construction has been tentatively scheduled to begin in 2010.

The South Stream pipeline is designed to annually pump 31 billion cubic meters of Central Asian and Russian gas to the Balkans and on to other European countries, but its capacity could be increased by a further 16 billion cu m. The project involves Bulgaria, Serbia, Hungary, Italy and Greece.

Russia’s transit disputes with its former Soviet neighbors have raised concerns in Europe about too much energy dependence on Russia.

Russia cut off gas supplies to Ukraine on January 1 after failing to reach a deal over debt and prices for 2009 in late December, and later halted gas deliveries to Europe, saying Ukraine was stealing transit gas. Kiev denied the accusation.