A Snapshot of Key Developments in the External Relations of the Russian Gas Sector for August 2012 By Jack Sharples, EGF Associate Researcher on the external dimensions of Russian gas
Key points:
Gazprom and the Lithuanian Government both claim victory following the Stockholm Chamber of Commerce
Arbitration Institute ruling over Lietuvos Dujos
Gazprom signs contracts with four Turkish energy companies to supply 6 bcm of Russian gas from January
2013, replacing the volumes given up by Turkish state energy company, Botaş, in October 2011
Nord Stream AG completes the welding of the second string of Nord Stream pipeline and requests permission
to conduct research in Estonian territorial waters as part of plans for the expansion of the Nord Stream
pipeline
South Stream could be re-routed via Croatia, bypassing Hungary
Putin and Yanukovych meet in Sochi, with Ukraine planning to reduce its Russian gas imports and hoping for
an (unlikely) gas price discount
Gazprom CEO, Alexei Miller, held meetings in Belarus, discussed investments in the gas transmission system
of Beltransgaz and the expansion of natural gas as a motor fuel in Belarus
Statoil withdraws from the Shtokman project, ceding its stake to Gazprom – Will Total follow suit?
Novatek announces a breakthrough deal to supply gas to German utility company EnBW, as E.On Russia
confirms that it will buy gas for its power stations from Novatek, not Gazprom, from 2013
A Snapshot of Key Developments in the External Relations of the Russian Gas Sector By Jack Sharples, EGF Associate Researcher on the external dimensions of Russian gas
Key points:
Gazprom suffers a setback as the Lithuanian parliament approves construction of an LNG plant at Klaipeda
as part of efforts to reduce dependence on Russian gas, but agrees a gas price discount for E.On and extends
contract with Moldovgaz, potentially halting Moldova’s implementation of the Third Energy Package
Mixed fortunes for Gazprom in Turkey as the company wins the right to sell gas to private Turkish energy
companies, but suffers a setback with the announcement of a Turkish-Azerbaijani agreement on the
construction of the TANAP pipeline
The Nord Stream project is on schedule for the second string launch in Q4 2012. CEO Alexei Miller suggests
that Nord Stream could be extended to the UK
Macedonia and Respublika Srpska reiterate their enthusiasm for South Stream, but the date of final
investment decision and the application of the EU Third Energy Package remain unclear
Putin meets Yanukovych in Yalta but refuses demands for gas price discount
More negotiations between Gazprom and CNPC, but with no breakthrough
Shtokman talks delayed with a result not being expected until autumn 2012
Gazprom is ranked as the world’s most profitable company by Forbes, but only comes 98th of 105 in
transparency rankings according to report by Transparency International
Novatek begins construction of Sabetta LNG terminal in Yamal region, but claims no threat to Gazprom’s
export monopoly
Rosneft expands its presence in the Russian gas market with an acquisition of a 6 percent stake in
independent gas company Itera
A Snapshot of Key Developments in the External Relations of the Russian Gas Sector1
Key points:
Gazprom Chairman of Board of Directors Viktor Zubkov and CEO Alexei Miller retain their positions as the
Gazprom Annual General Shareholders Meeting elects a new Board of Directors and approves record
dividends of 8.97 Roubles per share
Gazprom’s Annual General Shareholders Meeting also approves Gazprom’s Annual Report 2011, which marks
a record-breaking year for additions to gas reserves, sales revenues, net profits, and investment in the
gasification of Russia’s regions
The first string of Nord Stream reaches full capacity. Construction of the second string was completed in April,
with deliveries scheduled to begin in October
A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
Key points:
Greece – Gazprom appears set to take part in the tender for the purchase of Greek state monopoly DEPA SA,
with the aim of gaining direct access to local gas consumers
Israel – Gazprom continues to negotiate some form of participation in the Israeli ‘Leviathan’ and ‘Tamar’ gas
fields. A preliminary agreement for the purchase of 2‐3 million tons of LNG has already been reached as
Gazprom strengthens its position in the Southern European gas markets.
Ukraine – European investors are losing interest in the modernisation of Ukraine’s gas transportation system
(GTS), suggesting a possible Gazprom‐Naftogaz deal as Gazprom seeks direct access to Ukrainian gas
consumers.
Ukraine – The winter dispute over the short supply of Russian gas to Western Europe via Ukraine continues as
Gazprom and Naftogaz trade mutual accusations.
Nord Stream – The European Commission has ruled that 33‐50 percent of the capacity of the two pipelines
(NEL and OPAL) which connect Nord Stream to the rest of Germany’s gas infrastructure must be reserved for
Third Party Access, potentially forcing Nord Stream to operate at less than full capacity.
Lithuania – Gazprom is trying to challenge the conditions of the EU Third Energy Package in court, with
Lithuania the test case. Yet the most Gazprom can hope to achieve is a delay in the unbundling of Lietuvos
Dujos.
Lithuania – In a bid to reduce its dependency on expensive Russian gas supplies Lithuania is seeking
alternative suppliers and has proposed a gas swap deal with Gazprom. However, a more realistic
diversification option seems to be the construction of a new gas import pipeline from Poland.
Europe – Negative operating results and the continued disparity between spot market and long‐term
contract prices are prompting European energy companies to seek price concessions from Gazprom.
Russia – An increase in revenues from higher Russian domestic gas prices looks set to be offset by an increase
in the Mineral Extraction Tax rate for Gazprom. The Ministry of Finance and the Ministry of Energy are
discussing a new draft law that would deprive Gazprom of 80 to 100 percent of the potential extra
profits from higher domestic gas prices. READ MORE
EGF Editorial |
Опубликовано на EGF: 16.04.2012
| External Relations
A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
Key points:
Gazprom hasn’t given up on its attempts to break into South-East Asian gas markets. Its proposal for a
potential trans-Korean pipeline has found support in both North and South Korea. However, North Korea’s
change in leadership casts a shadow of doubt over the situation
Gazprom’s purchase of the remaining 50 percent share in Beltransgaz brought a sigh of relief to European
consumers, with transit disputes and Belarusian debts for Russian gas seemingly laid to rest. The purchase is
one of several measures designed to bring Russia and Belarus closer together, and demonstrate to Ukraine
the potential benefits of selling its gas transportation system to Gazprom
Nord Stream was launched with great fanfare. The launch has a substantial impact on the current transit
situation, with Ukraine looking like the loser of the piece as its transit volumes are increasingly likely to fall
Gazprom intensified negotiations with Kiev over the possible sale of Ukraine’s gas transit system. Given the
sale of Beltransgaz to Gazprom and the announcement that South Stream will go ahead as planned, there is
a fair chance that Kiev will give up shares in its gas transport system
The Turkish national gas pipelines operator, Botaş has refused to renew its 26-year contract to purchase 6
billion cubic metres (bcm) of Russian gas annually, which expired on the 31st of December 2011. Gazprom’s
subsequent attempts to circumvent the national supplier have failed: The Turkish Ministry of Energy has
refused applications by 26 companies for licences to import Russian gas
PGNiG has filed an arbitration case against Gazprom for lower gas prices and greater spot-price element in
contracts. Even if the Polish company ultimately succeeds in its aim, the process could drag on for months
Gazprom plans to pay record dividends, estimated to be 200bn Roubles. However, shareholders should not
expect such generosity from Gazprom next year: The size of Gazprom’s declared investment programme
precludes similar profits next year.
A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
Key points:
In a somewhat surprising development for Gazprom, Turkish state-owned gas pipeline operator, Botaş, has
declined to extend its contract for 6 billion cubic metres (bcm) of gas per year. The move is seen by some as
an attempt by Ankara to obtain gas price discounts.
The Polish state-owned energy company, PGNiG, has joined its European counterparts in pressing for lower
gas prices from Gazprom. Warsaw wants to change the gas price formula and tie it to spot gas market prices.
Another recent, unpleasant surprise for Gazprom was the launch of an investigation into its European
partners carried out by the European Commission (EC). Officially, the EC investigation concerns the potential
violation of antimonopoly legislation, although some commentators see the investigation as an attempt to
strengthen the position of European consumers in their negotiations with the Russian gas giant.
Belarus has agreed terms with Gazprom for the sale of the remaining 50 percent stake in Beltransgaz. In
return, Belarus President, Alexander Lukashenko, is demanding guarantees of transit through the Belarusian
pipeline network and a reduction in gas import prices to the level of internal Russian prices.
Ukraine President, Viktor Yanukovich’s attempt to destroy his political rival, Yulia Timoshenko, is playing into
Gazprom’s hands. As Brussels toughens its stance towards Kiev, Ukraine is forced to be more amenable in its
negotiations with Russia, especially those over the future of Ukraine’s Gas Transit System (GTS)
Prime Minister Vladimir Putin’s visit to China failed to produce a breakthrough in negotiations over the Altai
gas pipeline and potential Russian gas deliveries to China. The price of gas exports via the Altai pipeline
remains the main stumbling block, as Gazprom is currently seeking other ways of exporting gas to China,
namely via the Sakhalin-Khabarovsk-Vladivostok pipeline.
A Snapshot of Key Developments in the External Relations of the Russian Gas Sector
Key points:
Gazprom partners raided by European Commission Anti-trust Inspectors
The dispute between Moscow and Kiev continues. Ukraine knows that it has a weak bargaining position and
is in no hurry to make concessions to Russia
Prime Minister Vladimir Putin launched the first string of Nord Stream, meaning Ukraine is now in danger of
losing its status as the main transit country for Russia’s European gas exports
Gazprom has signed roadmap with South Korea's Kogas for the construction of a pipeline from Vladivostok to
South Korea
Gazprom may suspend its project in Nigeria because of the lack of a law governing the oil and gas industry,
although experts say Gazprom may have lost interest in this project because of potential difficulties in selling
Nigerian gas
Gazprom is looking to acquire two state-owned oil and gas companies in Kyrgyzstan
The Gazprom affiliate Vemex has acquired a 51% stake in RSP Energy, marking the first time a Gazprom
Group company will sell gas and electricity to Czech households
Gazprom has signed a legally-binding agreement with its European partners on the implementation of the
South Stream project, but has attracted criticism from the EU. According to Russian sources, EU Energy
Commissioner, Guenther Oettinger, views South Stream as an attempt by Moscow to derail the ‘Southern
Corridor’ gas supply diversification concept
In line with new oil production projects in the region, Gazprom Neft is considering the construction of a new
oil refinery near Murmansk
Gazprom expects a doubling of the Mineral Extraction Tax by 2013.
A Snapshot Of Key Developments In The External Relations Of The Russian Gas Sector
This year, Gazprom is likely to report an income of about $60 billion from the export of 158 bcm of gas to Europe, according to expert estimates. This represents a 12 percent growth in income compared to the previous year and, according to Alexander Medvedev, Deputy Chairman of Gazprom’s Board of Executive Directors, the company’s profits will be close to the record-breaking levels of 2008, when its income from exports reached $65 bn. READ MORE
EGF Editorial |
Опубликовано на EGF: 21.08.2011
| Energy
A Snapshot Of Key Developments In The External Relations Of The Russian Gas Sector
The President of Belarus, Alexander Lukashenko, seems to be optimistic about the possibility of obtaining Russian credits to rescue the Belarusian economy. On May 17, he
stated that Moscow was ready to lend Minsk $6 billion in 2011. However, the Kremlin responded by suggesting that it will only lend $1 billion and that even this amount will only be possible in combination with the sale of a number of Belarusian assets, notably a 50 percent stake in Beltransgas. Gazprom already holds a 50 percent stake in the company. READ MORE
EGF Editorial |
Опубликовано на EGF: 13.06.2011
| Energy
A Snapshot Of Key Developments In The External Relations Of The Russian Gas Sector
On April 25 of this year Gazprom head, Alexei Miller, predicted that the price of gas sold to European gas consumers would increase to $500 per 1,000 cubic metres by the end of 2011. This suggests a price hike of almost 40 percent as currently the average European gas price is $350 per 1,000 cubic metres. While Gazprom officials do make public references to limitations to increases in the gas price, most such comments tend to refer to Russian domestic gas prices. READ MORE
EGF Editorial |
Опубликовано на EGF: 01.05.2011
| Energy
EGF Head of Research, Dr. George Vlad NICULESCU, co-edited a new volume on “Understanding Contemporary Information Landscape Handbook (UCIL)” with the Austrian National Defence Academy and the PfP Consortium of Defence Academies and Security Studies Institutes: “The idea of this Handbook sprang forth from a policy recommendation issued at a past Regional Stability in the South Caucasus Study Group (RSSC SG) workshop: “Create, with the assistance of PfP Consortium volunteers, a Reference Curriculum on Media Literacy, emphasizing the impact of modern communication techniques and social media on human biology, psychology and behaviour. The aim would be to raise awareness of the media as a tool of hybrid warfare, and how to build resilience to it at individual level.” Looking with an academic eye at the final product of our last three years of work I’d conclude that this Handbook is a great success as a valuable education tool for students and teachers in media studies, politics, international relations. READ MORE
EGF Affiliated Expert Benyamin POGHOSYAN commented for the author of a “Turkey recap” report on “Turkey-Armenia normalization proceeds (or not) with Baku’s consent”. He thought that: “Pashinyan's government is basically signalling that if there's political will on the Turkish side, relations can be normalized tomorrow. But in the third year of normalization talks, it looks more like an imitation of negotiations.” READ MORE
EGF Affiliated Expert Nika CHITADZE published a new book on “World Politics” with the International Black Sea University from Tbilisi, Georgia. The book is divided into four main parts: first part is dedicated to the history and theory of world politics; second part analyses key processes in world politics, such as: globalization, integration, and democratization. Third part describes the basic challenges facing the international community, including arms control and security, conflicts, terrorism, organized crime, failed states, demography, migration, environment, relations between the “Global North” and the “Global South”. The fourth part reviews the main aspects of regulating the political processes in the world with the methods and instruments of foreign policy and diplomacy, and global governance. READ HERE
EGF Affiliated expert Yeghia TASHJYAN has recently published research on: “The Battle of the Corridors: Regional Interconnectivity and the Geo-economic future of the Middle East”. He concluded that “[…] it is essential to analyse Russia’s position in the South Caucasus and the logic of “regional interconnectivity” that Moscow is aiming to have land access to the Middle East. Russia views these regions from a holistic perspective, that is those regions have shared historical, cultural, and economic interactions, and are not geographically separated areas.” READ HERE
Between 07-10 November 2024, Dr Marat TERTEROV and Dr George Vlad NICULESCU participated in the 28th workshop of the Regional Stability in the South Caucasus Study Group of the PfP Consortium of Defence Academies and Security Studies Institutes on “Connectivity Risks and Opportunities in the South Caucasus”, held in Reichenau a/d Rax (Austria). Please click here for the programme and agenda outline, and here for George’s speaking points.
Between 11-13 April 2024, Dr Marat TERTEROV and Dr George Vlad NICULESCU participated in the 27th workshop of the Regional Stability in the South Caucasus Study Group of the PfP Consortium of Defence Academies and Security Studies Institutes on “Does the European Union Need a Strategy for the South Caucasus?”, held in Chisinau (Republic of Moldova). Please click here for the programme and agenda outline, here for George’s speaking points, and here for the ensuing Policy Recommendations.
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