As Moscow ploughs ahead with both the Nord Stream and South Stream gas projects the EU continues to drag its diplomatic feet with the rival Nabucco scheme. Europe's need to build consensus continues to stifle progress whilst Russia forges vital bilateral financial alliances with state partners and international construction firms. Nabucco and its European Union's sponsors may have the support of Turkey, Bulgaria, Romania, Hungary and Austria but Russia has signed agreements with Italy, Serbia, Bulgaria, Germany, Sweden, Finland, Greece and most recently Slovenia. Pipeline politics is quickly dividing Europe over fault lines of energy provisions. The EU must therefore recognise its need to diversify supply routes effectively.
The key question for Nabucco is: where will its gas come from? Russia's supplies are safe with plans for increased development of the Yamal Peninsula set to further tap Siberia's vast resource wealth. However, the Nabucco holding company can only confirm a supply of 8billion cubic metres (bcm) leaving a capacity deficit of 23bcm. With Turkmenistan recently committing its gas eastwards with the inauguration of the China-Central Asia pipeline and Azerbaijan steering away following a bilateral dispute with Turkey, the issue of supply looks set to dominate the agenda. Iran's Foreign Minister Manouchehr Mottaki recently suggested that the completion of the Nabucco line from Eastern Turkey to Europe's hub at Baumgarten in Austria is not viable without Iranian gas. With the EU ignoring such a scenario, Nabucco can clearly no longer supply the reliable alternative necessary to balance Russia's increasing gas monopoly.
With both the Nord and South Stream opting for offshore routes both projects bypass the former Soviet space, the site of disputes and 'switch offs' in January 2006 and 2009. The increasing fear is that Moscow will use the new pipelines to isolate those states whose majority gas supplier is Russia such as Slovakia (100% Russian supplied), Poland (86%) and Hungary (89%). In addition, even Nord Stream partners have articulated fears over Moscow's ability to use the infrastructure as a means of espionage with the Swedish Defence Minister and German Bundeswehr, making official moves to amend construction. Many view the state owned monopoly Gazprom led lines as tentacles expanding from Moscow as a means of maintaining a sphere of influence. The Kremlin unsurprisingly rebuffs this simply as 'Russiaphobia', however, it is hard to see how the construction of both the 'stream' pipelines will do anything other than serve geopolitical interests. Most analysts appear to agree that Europe will be oversupplied with gas for the next five years. This indicates that although a considerable rise in consumption is expected by 2030, the current race for construction is far more about diversifying supply for both the EU and Russia. It is now about securing future gas stocks.
In this respect the pipelines are essentially becoming front lines for a new European geopolitics. Heavy weights such as Vladimir Putin and President of the European Commission José Manuel Barroso have been actively involved in negotiations. Moscow has been particularly eager to prove its reliability and is working with a range of European partners on the 'streams' in addition to bringing in Japanese firm Sumitomo for the construction of Nord Stream Phase 2.
In an era where national problems easily vault over borders, diversification of supply options is increasingly necessary. Instead of political borders, regions and sub regions will be defined by the precarious supply of natural resources from the big players in the East such as Russia, Turkmenistan and the Caspian states. Instead of banking on the unsteady Nabucco, the West should instead focus on the Ukraine/Georgia sponsored White Stream project as a viable alternative. Set to run from an interconnector with the South Caucasus Pipeline in Tbilisi, across the Black Sea to Ukraine and then into the EU via Romania, the European Commission identified it as a Priority Project in 2008. Although its projected capacity of 32bcm is less than that of the Gazprom 'streams' it would still match the modest Nabucco supply line of gas out of Russia's jurisdiction allowing the two former Soviet states to develop energy policy autonomously. In doing so, the former fault lines of political ideology will be converted into pipeline transit routes along which Europe can avoid a dislocated, uneven energy framework.
Josh Posaner is a freelance journalist based in London. He also completed an internship with atlantic-community.org in 2009 and holds a M.A. from the School of Oriental and Asian Studies.
Related Materials from Atlantic Community:
- Ivan Kalburov: Europe Needs To Liberalize its Gas Market Now!
- Jens F. Laurson & George A. Pieler: Europe Has to Get Serious About Energy
- Andrey Chubyk: European Energy Security Requires Transparancy



February 4, 2010
Greg Randolph Lawson, Personal, Platinum Contributor (224)