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Pipe Dreams Why Public Subsidies for Lukoil in Azerbaijan Will Not
Reduce EU Dependency on Russia
14:22 January 28, 2015
http://bankwatch.org/sites/default/files/PipeDreams-LukOil-21Jan2015.pdf
After years of discussions about diversifying Europe's gas supply to
reduce dependence on Russian imports, during the last year the EU has
prioritised the Southern Gas Corridor or Euro-Caspian Mega Pipeline,
as it has been dubbed by civil society groups. Estimated at USD 45
billion, this chain of projects would bring gas to Europe from the
Shah Deniz offshore gas field in Azerbaijan, owned by BP, Russia's
Lukoil, and Azerbaijan's SOCAR, among others.
The corridor would pass through Georgia, Turkey, Greece, Albania and
Italy to other EU markets, and consist of the South Caucasus Pipeline
extension (SCPx), Trans-Anatolian Pipeline (TANAP), Trans-Adriatic
Pipeline (TAP) and other branch lines. Later it may also include the
Trans-Caspian Pipeline (TCP), which would enable the export of Turkmen
gas to the EU.The preference for the Southern Gas Corridor has been
given additional bearing by the conflict between Ukraine and Russia,
and although the projects are mostly carried out by private sector
companies (except SOCAR which is owned by the state of Azerbaijan),
the EU looks set to take on many of the risks: the Southern Gas
Corridor will be backed with public money via the connecting Europe
Facility, potentially the European Investment Bank (EIB) and the
Project Bonds Initiative, and indirectly via a loan by the European
Bank for Reconstruction and development to Lukoil for the second phase
of developments at Shah Deniz, a loan set to be approved in early
2015. Export credit agencies from EU countries may also back the
Corridor.
This brings financial risks for the EU and its Member States, which
could end up costing taxpayers, gas consumers, and the people in
exporting and transit countries. If new gas import infrastructure is
the wrong answer, it is partly because the wrong questions are being
asked. someone who asks "How much energy can we save? How do we do it?
What does it cost? Down to what level can we reduce our energy
demand?" and works to achieve these goals will end up saving energy.
Someone who asks "From which country can we get gas that isn't
Russia?" will end up dancing with repressive regimes of all shades
like those in Azerbaijan, Turkey and Turkmenistan, and looking around
for money to pay for expensive pipeline projects.That the EU has not
prioritised energy savings sufficiently is epitomised by the recent
disappointing, non-finding energy efficiency target of 27 percent by
2030. But even if this target is accepted as sufficient, the EU has
not sufficiently analysed how much gas is really needed in a
decarbonised EU. It has prioritised a whole series of huge gas import
projects in its list of Projects of Common Interest (PCIs), of which
the Southern Gas Corridor is the largest, but its own Energy Roadmap
2050 shows that we simply do not need so much gas during the coming
decades if the EU is to
reduce its use of fossil fuels. The impact assessment for the adoption
of energy efficiency targets for 2030 show the same thing.
The full article you can find here.
http://bankwatch.org/sites/default/files/PipeDreams-LukOil-21Jan2015.pdf
http://ecolur.org/en/news/officials/pipe-dreams-why-public-subsidies-for-lukoil-in-azerbaijan-will-not-reduce-eu-dependency-on-russia/6969/
From: A. Papazian
Reduce EU Dependency on Russia
14:22 January 28, 2015
http://bankwatch.org/sites/default/files/PipeDreams-LukOil-21Jan2015.pdf
After years of discussions about diversifying Europe's gas supply to
reduce dependence on Russian imports, during the last year the EU has
prioritised the Southern Gas Corridor or Euro-Caspian Mega Pipeline,
as it has been dubbed by civil society groups. Estimated at USD 45
billion, this chain of projects would bring gas to Europe from the
Shah Deniz offshore gas field in Azerbaijan, owned by BP, Russia's
Lukoil, and Azerbaijan's SOCAR, among others.
The corridor would pass through Georgia, Turkey, Greece, Albania and
Italy to other EU markets, and consist of the South Caucasus Pipeline
extension (SCPx), Trans-Anatolian Pipeline (TANAP), Trans-Adriatic
Pipeline (TAP) and other branch lines. Later it may also include the
Trans-Caspian Pipeline (TCP), which would enable the export of Turkmen
gas to the EU.The preference for the Southern Gas Corridor has been
given additional bearing by the conflict between Ukraine and Russia,
and although the projects are mostly carried out by private sector
companies (except SOCAR which is owned by the state of Azerbaijan),
the EU looks set to take on many of the risks: the Southern Gas
Corridor will be backed with public money via the connecting Europe
Facility, potentially the European Investment Bank (EIB) and the
Project Bonds Initiative, and indirectly via a loan by the European
Bank for Reconstruction and development to Lukoil for the second phase
of developments at Shah Deniz, a loan set to be approved in early
2015. Export credit agencies from EU countries may also back the
Corridor.
This brings financial risks for the EU and its Member States, which
could end up costing taxpayers, gas consumers, and the people in
exporting and transit countries. If new gas import infrastructure is
the wrong answer, it is partly because the wrong questions are being
asked. someone who asks "How much energy can we save? How do we do it?
What does it cost? Down to what level can we reduce our energy
demand?" and works to achieve these goals will end up saving energy.
Someone who asks "From which country can we get gas that isn't
Russia?" will end up dancing with repressive regimes of all shades
like those in Azerbaijan, Turkey and Turkmenistan, and looking around
for money to pay for expensive pipeline projects.That the EU has not
prioritised energy savings sufficiently is epitomised by the recent
disappointing, non-finding energy efficiency target of 27 percent by
2030. But even if this target is accepted as sufficient, the EU has
not sufficiently analysed how much gas is really needed in a
decarbonised EU. It has prioritised a whole series of huge gas import
projects in its list of Projects of Common Interest (PCIs), of which
the Southern Gas Corridor is the largest, but its own Energy Roadmap
2050 shows that we simply do not need so much gas during the coming
decades if the EU is to
reduce its use of fossil fuels. The impact assessment for the adoption
of energy efficiency targets for 2030 show the same thing.
The full article you can find here.
http://bankwatch.org/sites/default/files/PipeDreams-LukOil-21Jan2015.pdf
http://ecolur.org/en/news/officials/pipe-dreams-why-public-subsidies-for-lukoil-in-azerbaijan-will-not-reduce-eu-dependency-on-russia/6969/
From: A. Papazian