Russia's Gazprom further cuts gas flow to Europe by half amid turbine dispute

he logo of Russia's energy giant Gazprom is pictured at one of its petrol stations in Moscow on July 11. The Russian state-run energy company said supplies through the Nord Stream 1 pipeline to Germany would drop to just 20 per cent of capacity. (Kirill Kudryavtsev/AFP/Getty Images)

Russia tightened its gas squeeze on Europe on Monday as Gazprom, Russia's state-owned energy corporation, said supplies through the Nord Stream 1 pipeline to Germany would drop to just 20 per cent of capacity.

Read more at: Russia's Gazprom further cuts gas flow to Europe by half amid turbine dispute | CBC News

Russia Ukraine Invasion: Putin’s Ukraine threats may backfire on Russia, says energy chief - by Fiona Harvey

Vladimir Putin’s threats over Ukraine could backfire to damage the Russian economy, the head of the International Energy Agency has warned, as any escalation of the current tension would cause a “seismic” upheaval of the EU energy market that would have “more consequences for Russia” than for Europe.

Fatih Birol, the executive director of the global energy watchdog, said that if Russia reduced gas supplies further it would prompt European countries to seek urgently to shift away from Russian gas, which would hurt Putin economically.

“If Russia stops the gas supply to Europe, it could have a seismic impact on European energy. [Russia] has to consider the consequences if existing oil and gas supplies to Europe are halted,” Birol told the Guardian.

Read More at: Putin’s Ukraine threats may backfire on Russia, says energy chief | Russia | The Guardian

Finland-NATO relations: Russia may cut gas supplies to Finland over its decision to join NATO

Hours after Moscow threatened retaliation against Finland for its decision to apply for NATO membership, Finnish media reported that the Kremlin has threatened to cut off the country's access to Russian gas by May 13. Finland's Iltalehti media agency, citing unnamed sources, reported Russia's warning made to politicians.

Finland is expected to be cut off from Russian gas after May 23, when its next contract payment with Gazprom is due and the country refuses to pay in rubles, according to the local media outlet. It is worth mentioning that Russia cut off gas supplies to Poland and Bulgaria in late April after they refused to pay

However, Finnish Defense Minister Antti Kaikkonen told Iltalehti on May 12 that he couldn't confirm the warning. Meanwhile, working groups had been notified of "various scenarios of Russia’s retaliation," according to parliamentary group head Ville Tavio, who noted that preparations had already been made.

Read more at: Russia may cut gas supplies to Finland over its decision to join NATO: Report

Ukraine warns Europe of Russian gas cut-off, Moscow denies - by Natalia Zinets

Ukraine warned Europe on Wednesday that Russia could cut off gas to the continent this winter, but Moscow responded that the supply of gas would continue regardless of politics.

Ukrainian Prime Minister Arseny Yatseniuk said Kiev knew of Russian plans to halt gas flows this winter to Europe, comments that were promptly denied by Russian Energy Minister Alexander Novak.

"The situation in (Ukraine's) energy sector is difficult. We know of Russia's plans to block (gas) transit even to European Union countries this winter, and that's why their (EU) companies were given an order to pump gas into storage in Europe as fully as possible," Yatseniuk told a government meeting, without disclosing how he knew about the Russian plans.

Russia has halted gas flows to Ukraine, a major transit route for EU gas, three times in the past decade in 2006, 2009 and since June this year because of price disputes with Kiev.

In the past Russia's Gazprom has insisted it has been a reliable supplier to the European Union, its biggest market, and that flows to Europe were disrupted in 2006 and 2009 only after Ukraine took some of the gas intended for the EU to meet its own winter demand.


Read more: Ukraine warns Europe of Russian gas cut-off, Moscow denies | Reuters

EU Economy - Russia, Ukraine, EU agree to go ahead with trilateral consultations on gas

 Russia’s Energy Minister Alexander Novak and EU Energy Commissioner Gunther Oettinger will hold a bilateral meeting on Tuesday night to discuss issues of Russian natural gas supplies to Ukraine and Europe.

“We will discuss the current situation concerning with gas deliveries and transit,” Novak, who is currently visiting the Belarusian capital of Minsk, told journalists. “More detailed talks will be held in Moscow on August 29.

Earlier on Tuesday, Alexander Novak said Russia was ready to sell to Ukraine additional gas volumes should Kiev pay for them.

“We are always ready to sell [more gas] if we receive the money [for it],” Novak told ITAR-TASS.

Read more: ITAR-TASS: Economy - Russia, Ukraine, EU agree to go ahead with trilateral consultations on gas

Ukraine Crises: Europe Gas Options Seen Limited by Costs at $200 Billion - by Anna Shiryaevskaya and Isis Almeida

“In the short-term, there isn’t really a whole lot they can do,” Thomas Pugh, a commodities economist at Capital Economics in London, said yesterday by phone. “Energy security was taken as a given and it wasn’t something people were talking about a few months ago.”

Negotiators from Russia, Ukraine and the European Union agreed to guarantee no disruptions in gas supply through the end of this month, EU Energy Commissioner Guenther Oettinger said last week after a meeting between the three parties in Warsaw.

Europe can cope with a 90-day interruption in flows from Ukraine, assuming “reasonably high” stockpiles, cooperation between European states and normal flows of Russian gas through routes other than Ukraine, consultant Poeyry Oyj said today in an e-mailed report.

European gas prices have fallen 33 percent since Feb. 28, the last trading day before Russia took control of Ukraine’s Crimea region. U.K. front-month gas, the benchmark European contract, fell as much as 1.8 percent today to 44.91 pence a therm ($7.62 a million British thermal units), its lowest since September 2010 as milder-than-normal weather and above-average storage levels offset the threat of supply disruptions.

Read more at: Europe Gas Options Seen Limited by Costs at $200 Billion - Bloomberg

Ukraine: Putin warns Europe of gas shortages over Ukraine debts

Russian President Vladimir Putin has warned European leaders that Ukraine's delays in paying for Russian gas have created a "critical situation". 

Pipelines transiting Ukraine deliver Russian gas to several EU countries and there are fears that the current tensions could trigger gas shortages.

Pro-Russian separatists are holed up in official buildings in Donetsk and Luhansk, eastern Ukraine.
Meanwhile, a European human rights body has stripped Russia of voting rights.

The Parliamentary Assembly of the Council of Europe (PACE) monitors human rights in 47 member states, including Russia and Ukraine.

Protesting against Russia's annexation of Crimea last month, PACE suspended Russia's voting rights as well as Russian participation in election observer missions.

Read more: BBC News - Putin warns Europe of gas shortages over Ukraine debts

Middle East: Gas deal dispute reflects change in Israel-Egypt relations - by Jeffrey Fleishman

The decorum of diplomacy has devolved into embarrassing headlines and testy one-liners in the increasingly strained relations between Egypt and Israel.

Israeli Prime Minister Benjamin Netanyahu said Tuesday that Egypt's Sinai peninsula had become a "kind of Wild West" overrun by militants, terrorists and arms smugglers. Over the weekend, Foreign Minister Avigdor Lieberman had suggested massing more Israeli troops along the border with Egypt.

That drew a bit of mafia parlance from Egypt's military ruler, Field Marshal Mohamed Hussein Tantawi: "Our borders, especially the northeast ones, are inflamed. We do not attack neighboring countries but will defend our territory. We will break the legs of anyone trying to attack us or who come near the borders."

Rhetoric for domestic consumption, to be sure, but it symbolizes the changed tenor between the two countries since last year's revolution, in which Egyptian President Hosni Mubarak, who kept close ties with Israel, was deposed. Islamists are on the rise in Egypt, and Tantawi is keenly aware that the 1979 Egypt-Israeli peace treaty was never enshrined in the Egyptian soul.

For more: Gas deal dispute reflects change in Israel-Egypt relations - latimes.com

Nord Stream (also known as the Baltic Pipeline) stirs emotions in Europe - by Selene Rebane

The plans to build the politically and environmentally controversial Nord Stream pipeline have been in the air since 1997. With Finland and Sweden finally saying “yes” to the pipeline in their waters, the wheels of construction are now in full speed with the first line to be opened in the 2011. This will bring relief to Europe that is struggling with energy supply--yet not everyone is a winner.

The European Union accounts for 16% of the World's energy consumption but has only 6 % of the world's population. Natural gas comprises 24% of EU energy consumption. EU27 in 2007 consumed 505 bcm of natural gas per year according to Eurogas. This is expected to increase to 578 bcm by 2020 (estimations vary, some analysts claim that the gas consumption will decrease drastically). 40 % (128 bcm) of the natural gas is imported from Russia. The EU is also estimated to import 70% - 80 % of its energy supplies by 2030 as the North Sea gas supplies are diminishing; over 60 % of natural gas imports are expected to come from Russia. 10 % of the total EU gas demand would be covered by the Nord Stream. Natural gas will remain the fuel of preference for the EU because of its greener properties. In addition to that, phasing out nuclear power stations puts more strain on alternative energy sources. The pipelines that are running through Ukraine are aging and it is debatable at what capacity they would be running at by 2020: The EU offered Ukraine a loan of $2.5bn to revamp its pipeline infrastructure in March 2009, but it is debatable if this money went to pipeline upgrade projects as a proportion of that loan would have gone to repay existing gas debts to Russia; according to prime minister Tymoshenko, Ukraine would need an extra $3.5bn for the revamp of current pipelines.

The EU’s decision to lend $2.5bn was not welcomed by Russia, who said that it was “unprofessional” to make deals like this without consulting the main supplier (80 % of Russian gas exports currently go through Ukraine).

For more: The Oil Drum: Europe | What difference would Nord Stream mean to European energy supply?

Germany approves Russia’s Nord Stream gas pipeline project

Germany issued permission on Monday for the construction of Russia’s Nord Stream gas pipeline in its exclusive economic zone.

The permission was issued by Germany’s Federal Maritime and Hydrographic Agency in Hamburg. Earlier, Germany permitted the construction of the Nord Stream gas pipeline in its territorial wasters.

Nord Stream AG, the project operator, has already received permits from Denmark, Sweden and Russia through whose waters the pipeline will pass, and also the Finnish exclusive economic zone permit and a permit for the 50-kilometer (31-mile) section of the pipeline in German territorial waters and landfall in Lubmin near Greifswald.

Nord Stream AG only has to obtain the second and final permit from Finland for the project’s construction.

For more : tehran times : Germany approves Russia’s Nord Stream gas pipeline project

Middle East Online: Turkey eyes energy role with Russia - by Sibel Utku Bila

For the complete report from the Middle East Online click on this link

Turkey eyes energy role with Russia

Turkey eyes energy role with Russia - by Sibel Utku Bila

Russian Prime Minister Vladimir Putin is to visit Ankara Thursday for talks expected to focus on energy cooperation amid a growing Turkish role in projects to carry gas and oil to Europe. "Cooperation in the field of energy will be a primary issue on the agenda," an aide to Turkish Prime Minister Recep Tayyip Erdogan said. Situated between Europe and the vast oil and gas fields of the Caspian Sea and the Middle East, Turkey has emerged as a hub for pipelines to supply the energy-hungry West. Hoping to attract Russian and Kazakh oil, Ankara is also promoting a pipeline from its Black Sea port of Samsun to Ceyhan on the Mediterranean coast, which already serves as a terminal in conduits pumping oil from Azerbaijan and Iraq. Putin's energy agenda in Ankara is likely to include also a long-delayed project to build Turkey's first nuclear power plant.

Despite sometimes shaky political ties, economic exchange between the two countries has boomed since the fall of Communism: in 2008, their trade volume hit 37.8 billion dollars, making Russia Turkey's number one trading partner. Russia supplies about 60 percent of Turkey's gas imports, and more than a million Russian holiday-makers boost Turkey's vital tourism sector each year.

BBC NEWS: Europe gas pipeline deal agreed

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Europe gas pipeline deal agreed

Four European Union countries and Turkey have signed an agreement to construct the long-planned 3,300km Nabucco natural gas pipeline. Once completed, the line will bring up to 31 billion cubic metres of gas a year from the Caspian and the Middle East across Turkey and into Europe. It will give an important alternative energy supply to Russia, which already meets 30% of Europe's gas needs.

BBC NEWS: Deal to boost key EU gas project - by Oana Lungescu

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Deal to boost key EU gas project - by Oana Lungescu

The EU has signed an energy agreement with several countries aimed at developing a "southern corridor" for gas supplies bypassing Russia. The agreement was signed by the leaders of Azerbaijan, Georgia, Turkey and Egypt at a summit in Prague. It commits them to speeding up the construction of a long-delayed pipeline to bring Caspian gas to Central Europe. Key to this meeting was a commitment by Turkey's President Abdullah Gul to sign up to an agreement on the construction of the Nabucco gas pipeline by next month. In a symbolic gesture, the agreement is to be signed in Turkey, after years of haggling over transit rules.

LA Times: EU passes new rules on opening up gas and electricity markets after nearly 3 years - by Aoife White

For the complete report from the Los Angeles Times click on this link

EU passes new rules on opening up gas and electricity markets after nearly 3 years - by Aoife White

The European Union on Wednesday approved new rules for opening up gas pipelines and electricity grids to competition — a move that regulators claim could help bring down energy prices and improve energy security. But consumers and some lawmakers said nearly three years' of negotiations on the rules had watered them down so much that they could not challenge the grip large energy firms' have over the European market.

Global Post: Pipeline talks put Turkey at center stage - by Nichole Sobecki

For the complete report from the GlobalPost click on this link

Pipeline talks put Turkey at center stage - by Nichole Sobecki

Recep Tayyip Erdogan's visit to Brussels last week, his first since Turkey began negotiations to join the European Union in 2005, threw the spotlight on an issue given fresh impetus by the recent gas crisis between Russia and Ukraine: the Nabucco pipeline project. Nabucco, symbolically named for Giuseppe Verdi's 1842 operatic masterpiece that became a rallying cry for a generation of Italians determined to fight off Austrian military occupation, promises a different kind of freedom — that of energy independence from Russia. Erdogan's visit, amid the distractions of the U.S. presidential inauguration, served to remind all parties to a summit beginning this week that Nabucco could become a key sticking point in negotiations over EU accession, which Erdogan described as a "top priority" for Turkey.

If construction on Nabucco begins next year, as currently envisaged, the new pipeline could be operational by 2013. Bulent Aliriza, director of the Turkey Project at Washington, D.C.-based think tank the Center for Strategic and International Studies, says the advantages for European countries, and for Turkey, are "undeniable." "Europeans need the gas, and linked to that, they want to break away from the Russian monopoly," he said. "There is gas in and around the Caspian, and Turkey wants to be the key conduit in the transportation of this gas to Europe."

Huliq News: Gas Transport to Europe to Resume After Deal

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Gas Transport to Europe to Resume After Deal

Natural gas may soon start to flow from Russia to Europe: the prime ministers of Russia and the Ukraine have agreed to a deal after a marathon series of talks. The deal was reached between Russian Prime Minister Vladimir Putin and his Ukrainian counterpart Yulia Tymoshenko. Ukraine would be offered a 20% discount on the market price for Russian natural gas deliveries this year, if it agrees to keep transit fees for pumping gas to Europe via its pipelines at the 2008 level.

Then from 2010 on, the two neighboring countries will switch to European market prices.

Kentucky.com: Russia to restart gas pumps to Europe on Tuesday - by Maria Danilova

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Russia to restart gas pumps to Europe on Tuesday - by Maria Danilova

Russia's state gas monopoly has promised to resume shipping Europe-bound gas through Ukraine on Tuesday morning, nearly a week after it shut off the taps and forced countless Europeans to huddle cold and resentful in freezing homes. However, a spokesman for the Gazprom monopoly indicated lingering problems could still prolong the crisis. More than 15 countries have been the inadvertent victims of a complex and acrimonious wrangle between Russia and Ukraine over gas prices, past debts and allegations of theft. They also jockeyed over an EU-brokered deal to send pipeline monitors to ensure that restored gas shipments reach their destination.

Bloomberg.com: Russia, Ukraine Appeal to EU in Gas Delivery Dispute - by - by Stephen Bierman and Daryna Krasnolutska

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Russia, Ukraine Appeal to EU in Gas Delivery Dispute - by Stephen Bierman and Daryna Krasnolutska

Russia and Ukraine sought support from the European Union to resolve their deepening dispute over gas supplies on the fifth day of suspension of shipments to the former Soviet state as OAO Gazprom raised its price demands. Gazprom Chief Executive Officer Alexei Miller said the Russian exporter hopes an offer to deliver gas to Ukraine this month at $450 per 1,000 cubic meters, the average price in countries bordering Ukraine, excluding transport costs, would bring Ukraine back to talks. Ukraine says $201 would be fair.

The Oil Drum: Is Europe Running Low on Natural Gas? - by Euan Mearns

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Is Europe Running Low on Natural Gas? - by Euan Mearns

OECD European gas production looks set to peak in 2008. After that, falling production combined with rising demand will see OECD European gas imports wanting to rise from current 197 BCM per annum to 442 BCM per annum by 2020. Where will this gas come from and how will rising European imports affect N America and the rest of the world?

As of 2006, OECD Europe produced 55% of its own natural gas with the majority of gas imports coming from Russia and Algeria. OECD Europe has three main gas producers - Norway, The UK and The Netherlands. Norwegian gas production is undergoing a major expansion, but this is forecast to halt at 130 BCM per annum next year for political resource conservation reasons. UK and Dutch gas production are in decline, and combined OECD Europe indigenous gas production looks set to peak in 2008.

FT.com - Russia and Ukraine in talks to end gas deadlock - by Roman Olearchyk in Kiev and Isabel Gorst

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Russia and Ukraine in talks to end gas deadlock - by Roman Olearchyk in Kiev and Isabel Gorst

An energy delegation from Ukraine arrived in Moscow on Monday for last-ditch talks aimed at resolving a gas debt dispute with Russia that could disrupt the supply of gas to Europe. Gazprom, Russia’s state-controlled gas group, has demanded that Ukraine settle $2bn of arrears for gas supplies this year or face a cut-off in deliveries from January 1.

The ex-Soviet countries are gearing up for a fourth energy stand-off in as many years, but have assured consumers in Europe that supplies will not be disrupted as happened during a 2006 dispute.