News / Economy

EU Struggles to Unpick Knot of Russia-Ukraine Gas Logistics

Pipelines are seen at a gas border delivery station of pipeline operator Eustream in the eastern Slovak town of Velke Kapusany, near the border with Ukraine, April 15, 2014.
Pipelines are seen at a gas border delivery station of pipeline operator Eustream in the eastern Slovak town of Velke Kapusany, near the border with Ukraine, April 15, 2014.
Reuters
Unprecedented talks across the European Union on Tuesday showed it scrambling for solutions on the ground to break its dependence on Russian gas and help supply Ukraine.

The EU faces a daunting task in quickly overcoming a mountain of logistical challenges, avoiding breaking binding contracts and making sure Ukraine does pay up for gas.

Russia supplies 30 percent of Europe's gas needs. It has threatened to cut off supplies to Ukraine because of debts reviving fears of a repeat of supply crises across Europe of 2007 and 2009.

Offering some relief for Ukraine, Germany's RWE began deliveries of natural gas on Tuesday, marking an initial step in EU efforts to boost supplies to Kyiv.

Sending gas to Ukraine from the EU is a powerful weapon.

The Russian state gas export monopoly Gazprom has long protested against the scheme, saying it feared its gas destined for Germany would be re-exported to Ukraine in breach of contracts.

RWE said it is a mixture of gas supplies from many sources, and Ukraine could get as much as 10 billion cubic meters (bcm) of gas per year under a framework 2012 agreement.

That would be a big boost to Kyiv - allowing it to cut Russian gas imports by a third - especially after Moscow nearly doubled the gas price it charges Ukraine, tearing up a discount agreed with the previous pro-Moscow president.

Delivery challenges

The problem would be to deliver the gas to Ukraine, which has annual gas consumption of 55 bcm.

Polish pipeline operator Gaz-System said it could deliver 1.5 bcm annually, Hungary can probably send another 3.5 bcm to Ukraine, while Romania has the potential to send 1.8 bcm, but there has been no firm agreement on its deliveries.

Slovakia is the EU's best-placed member to pump gas to Ukraine but reversing flows along any of the four pipelines that take Russian gas to it via Ukraine would require an agreement that doing so does not violate current contracts with Gazprom.

Slovakia and Ukraine failed to reach an agreement on Tuesday on reversing the flows, Slovak Economy Minister Tomas Malatinsky said.

Instead, the two sides are considering signing a memorandum later in April on a proposal to reopen a disused pipeline to take some gas out of a main East-West line, on the Slovak side of the border, and loop it back into Ukraine.

The link could supply more than three bcm annually to Ukraine from October, rising to around nine bcm by next spring.

”The memorandum which is prepared is a certain step toward reverse supplies from the European Union, but I am saying openly that given the situation - a very exceptional situation - we would need substantially more,” Ukrainian Energy Minister Yuri Prodan told reporters.

South Stream

While reverse flows would help cushion the effects of a Russian export cut during mild-demand summer months, analysts say they would not be sufficient in the winter.

Some countries in Europe are even more reliant on Russian gas than Ukraine, including Bulgaria, where the energy minister said on Tuesday he had discussed importing gas from Azerbaijan should Russia cut off supplies.

”We are carefully monitoring the situation in Ukraine. We discussed short-term actions so that we can guarantee gas supplies,” Dragomir Stoynev told reporters after meeting Azeri counterpart Natik Aliyev.

Aliyev said the pair discussed delivery of liquefied natural gas (LNG) to Greek ports and from there to Bulgaria.

Neither Azerbaijan nor Greece have the LNG terminals to provide such cargoes at the moment.

Russia pressed ahead with its South Stream natural gas link to Europe which aims to bypass Ukraine and help Moscow increase its share of the continent's supply, especially in southern Europe.

Following previous gas rows with Kyiv, Russia has invested billions of dollars in new pipelines, including Nord Stream, which brings additional gas to Germany bypassing Ukraine.

South Stream is planned to pump gas into Bulgaria and from there further into the EU by the end of the decade.

Gazprom's partner in the project, Italy's Eni, has said the future of South Stream has been put in question by the escalating dispute over Ukraine.

The EU has also postponed clearing the project.

Despite the crisis in relations, the consortium running the South Stream project said it would start laying the first stretch of pipes this fall.

You May Like

Video For West Ukraine City, Conflict Far Away Yet Near

Physically and culturally close to Western Europe, Lviv feels solidarity with compatriots in country’s east but says they need to decide own future More

West African Women Disproportionately Affected by Ebola

Women's roles in families and the community put them at greater risk for contracting the disease, officials say More

Video NASA's MAVEN Spacecraft Arrives at Mars

Mars Atmosphere and Volatile Evolution craft will measure rates at which gases escape Martian atmosphere into space More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
NASA’s MAVEN Probe Enters Mars Orbiti
X
September 22, 2014 9:20 PM
NASA’s newest Mars probe, called MAVEN, has successfully entered its designated orbit around the Red Planet. Scientists will use its sophisticated instruments to try to learn what happened to the atmosphere Mars had a few billion years ago. VOA’s George Putic has more.
Video

Video NASA’s MAVEN Probe Enters Mars Orbit

NASA’s newest Mars probe, called MAVEN, has successfully entered its designated orbit around the Red Planet. Scientists will use its sophisticated instruments to try to learn what happened to the atmosphere Mars had a few billion years ago. VOA’s George Putic has more.
Video

Video For West Ukraine City, Conflict Far Away Yet Near

The western Ukrainian city of Lviv prides itself on being both physically and culturally close to Western Europe. The Russian-backed separatists in the eastern part of the country are 1,200 kilometers away, and seemingly even farther away in their world view. Still, as VOA’s Al Pessin reports, the war is having an impact in Lviv.
Video

Video Saving Global Fish Stocks Starts in the Kitchen

With an estimated 90 percent of the world’s larger fish populations having already vanished, a growing number of people in the seafood industry are embracing the concept of sustainable fishing and farming practices. One American marine biologist turned restaurateur in Thailand is spreading the word among fellow chefs and customers. VOA Correspondent Steve Herman reports from Bangkok.
Video

Video Chinese Admiral Key in China’s Promotion of Sea Links

China’s President last week wrapped up landmark visits to India, Sri Lanka and Maldives, part of a broader campaign to promote a new “Maritime Silk Road” in Asia. The Chinese government’s promotion efforts rely heavily on the country’s best-known sailor, a 15th century eunuch named Zheng He. VOA's Bill Ide reports from the sailor’s hometown in Yunnan on the effort to promote China’s future by recalling its past.
Video

Video Experts Fear Ebola Outbreak ‘Beyond Our Capability to Contain’

Each day brings with it new warnings about the deadly Ebola outbreak already blamed for killing more than 2,600 people across West Africa. And while countries and international organizations like the United Nations are starting to come through on promises of help for those most affected, the unprecedented speed with which the virus has spread is raising questions about the international response. VOA's Jeff Seldin has more from Washington.
Video

Video Natural Gas Export Plan Divides Maryland Town

A U.S. power company that has been importing natural gas now wants to export it. If approved, its plant in Lusby, Maryland, would likely be the first terminal on the United States East Coast to export liquefied natural gas from American pipelines. While some residents welcome the move because it will create jobs, others oppose it, saying the expansion could be a safety and environmental hazard. VOA’s Deborah Block examines the controversy.
Video

Video Difficult Tactical Battle Ahead Against IS Militants in Syria

The U.S. president has ordered the military to intensify its fight against the Islamic State, including in Syria. But how does the military conduct air strikes in a country that is not a U.S. ally? VOA correspondent Carla Babb reports from the Pentagon.
Video

Video Iran, World Powers Seek Progress in Nuclear Talks

Iran and the five permanent members of the U.N. Security Council plus Germany, known as the P5 + 1, have started a new round of talks on Iran's nuclear program. VOA State Department correspondent Pam Dockins reports that as the negotiations take place in New York, a U.S. envoy is questioning Iran's commitment to peaceful nuclear activity.
Video

Video Migrants Caught in No-Man's Land Called Calais

The deaths of hundreds of migrants in the Mediterranean this week has only recast the spotlight on the perils of reaching Europe. And for those forunate enough to reach a place like Calais, France, only find that their problems aren't over. Lisa Bryant has the story.
Video

Video Westgate Siege Anniversary Brings Back Painful Memories

One year after it happened, the survivors of the terror attack on Nairobi's Westgate Shopping Mall still cannot shake the images of that tragic incident. For VOA, Mohammed Yusuf tells the story of victims still waiting for the answer to the question 'how could this happen?'
Video

Video Whaling Summit Votes to Uphold Ban on Japan Whale Hunt

The International Whaling Commission, meeting in Slovenia, has voted to uphold a court ruling banning Japan from hunting whales in the Antarctic Ocean. Conservationists hailed the ruling as a victory, but Tokyo says it will submit revised plans for a whale hunt in 2015. Henry Ridgwell reports from London.
Video

Video A Dinosaur Fit for Land and Water

Residents and tourists in Washington D.C. can now examine a life-size replica of an unusual dinosaur that lived almost a hundred million years ago in northern Africa. Scientists say studying the behemoth named Spinosaurus helps them better understand how some prehistoric animals adapted to life on land and in water. The Spinosaurus replica is on display at the National Geographic museum. VOA’s George Putic has more.
Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.Colonel Steve ‘Spiros’ Pisanos left Greece and came to the U.S. to learn to fly. He flew fighters for the Allies in World War II, narrowly escaping death multiple times.

AppleAndroid

World Currencies

EUR
USD
0.7768
JPY
USD
108.84
GBP
USD
0.6124
CAD
USD
1.0999
INR
USD
61.042

Rates may not be current.