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04/12/2016

Gazprom says EU not needed as mediator for gas sales to Ukraine

Energy

Gazprom says EU not needed as mediator for gas sales to Ukraine

Alexander Medvedev

[Commission]

Russia’s Gazprom yesterday (2 November) played down the EU’s decision to ease access to the Opal gas pipeline, crucial to Moscow’s plans to boost supplies via the Baltic Sea, and dismissed the bloc’s role as mediator in a row with Ukraine.

Last week, the European Union lifted a cap on Gazprom’s use of the Opal pipeline in Germany which takes gas from its Nord Stream Baltic Sea pipeline to end-users in Germany and the Czech Republic, opening the way for Russia to expand Nord Stream’s capacity and bypass Ukraine as a gas transit route.

EU, Russia reach ‘political’ deal on OPAL gas pipeline: sources

EU and Russia have agreed a deal on the use of Germany's OPAL link to Gazprom's Nord Stream gas pipeline, a Russian energy ministry spokeswoman said yesterday (16 September).

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However, Gazprom’s Deputy Chief Executive Alexander Medvedev told the Russia-24 TV channel on Wednesday that the Russian gas giant still has to analyse the decision.

“Unfortunately, the European Commission has made changes to our agreement … unilaterally. That’s why, before saying that the problem is solved, it should be analysed,” Medvedev said.

Since its completion in 2011, Gazprom has only been allowed to use 50% of the Opal pipeline under an EU ruling aimed at preventing dominance of the supply infrastructure. The decision drew rebukes from Poland and Ukraine.

Neighbouring Ukraine has not bought gas from Russia for about a year due to a political stand-off with Moscow, which annexed Ukraine’s Crimea in 2014.

In the past, the European Commission has successfully brokered gas deals between Russia and Ukraine.

Commission sheds light on trilateral gas talks with Ukraine, Russia

The European Commission aims at concluding an agreement to supply Ukraine with Russian gas until Fall 2016, when an international court will issue a ruling on Moscow’s pricing regime, a Commission official said.

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“Interference or help from someone else is not necessary. It’s enough for them to make a pre-payment and the gas will flow,” Medvedev said.

Apart from boosting gas supplies via the Baltic Sea, Gazprom also plans more sales to Turkey and southern Europe through the Black Sea. It wants to build two lines of the TurkStream pipeline, also called Turkish Stream, with a total capacity of 31.5 billion cubic metres per year.

Russia-Turkey rapprochement revives Turkish Stream pipeline talks

Turkey’s President Recep Tayyip Erdogan said on Monday (8 August) that Ankara was ready to take steps towards the implementation of the Turkish Stream gas pipeline project.

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One of the lines is designed for supplies to the Turkish market, Gazprom’s second-largest buyer of gas after Germany, while the second line would be for onward shipments to other countries, such as Greece.

Medvedev said Gazprom will not start the construction of the second line before it gets approval from EU regulators.