Nabucco reality will see U-turn in Russia: Joschka Fischer

Once the European Union’s natural gas pipeline project Nabucco moves close to reality, Russian energy policy in opposition to the project will U-turn, said Joschka Fischer, ex-vice federal chancellor of Germany, at an event in Bucharest

December 2009 - From the Print Edition

The eight-billion Euro Nabucco project is designed to diversify supplies of natural gas to the EU away from a Russian monopoly, by sourcing gas from central Asia, through Turkey and Romania and to western Europe.
“Once Nabucco comes into the situation where the pipeline will be built, the energy policy in Russia will change 180 degrees,” said Fischer, who now acts as a lobbyist for the pipeline.
Fischer opened the door to Russia’s Gazprom to join in the process of building the pipeline. “It would be a success if Gazprom were to be part of the process for Nabucco,” he told the Forum Invest audience.
The Nabucco consortium includes energy companies Romania’s Transgaz, Bulgaria’s BEH, Hungary’s MOL, Turkey’s Botas, Germany’s RWE and Austria’s OMV, but remains open to a potential seventh shareholder.
Nabucco states the first construction phase of 2,000 km could start in 2011 between Ankara and Baumgarten, Austria. There already exists a pipeline between Turkey and Georgia and Iran, which would be used for two years. The second construction phase, targeted at between 2014 and 2015, will revamp this section.
Although all EU countries and Turkey publicly back the project, there has been some scepticism of the commitment to Nabucco from central Asia. Fischer believes it is possible that gas can come from fields in the Caspian Sea belonging to Azerbaidjan and Turkmenistan first, and then from two major oil fields in Iraq. There are still major disputes over which of the five bordering countries of the Caspian Sea, including Iran, have economic ownership over some perimeters of water. “As long as the political situation is as it is in Iran, Nabucco is not possible for them,” said Fischer.
Nabucco is currently negotiating with the European Investment Bank and the European Bank for Reconstruction and Development for contracting a 1.45 billion Euro loan, said Vlad Pavlovschi, manager for Romania’s Transgaz. Another 1.06 billion Euro is planned to be attracted from commercial banks.
However Russia is pushing an alternative pipeline project, South Stream, which bypasses Ukraine and Romania to supply Russian gas to the west. Last month Slovenia became the latest country to join the project, which is backed by Russia’s Gazprom and Italy’s ENI. The ex-Yugoslav Republic is the last piece in the jigsaw, joining Bulgaria, Serbia, Hungary and Greece, to be part of this pipeline project.
But Fischer dismissed the Russian alternative. “There is no South Stream – only talk about South Stream,” he said.
One senior energy analyst told The Diplomat South Stream is a ‘Russian gambit’ and that it was still not clear what kind of capacity the proposed pipeline would have and where the gas would come from.
Asked if this was a gambit that could work, the analyst replied: “It may do if it spooks central Asia.”