Publication: Eurasia Daily Monitor Volume: 4 Issue: 189

Presidents and other top officials from the three Baltic states, Poland, Ukraine, Romania, Georgia, and Azerbaijan, joined by EU and U.S. officials, attended the Energy Security Conference on October 10-11 in Vilnius. It was the third event of this type, after the energy summits in May 2006 in Vilnius and May 2007 in Krakow. Most of the participant countries are heavily dependent on energy supplies from Russia, vulnerable to political manipulation of such supplies, and vitally interested in the formation of common external policies on energy by the European Union.

This Vilnius summit issued a comprehensive set of policy recommendations to the EU. Noting that external energy policy remains relatively neglected in EU energy policies and action plans, the summit called for urgent development of the external dimensions to the EU’s common energy policies. The Vilnius summit is asking the EU High Representative for Common Foreign and Security Policies, as well as the EU Energy Commissioner and External Affairs and Neighborhood Policy Commissioner, to work out by spring 2008 a comprehensive road map on developing a European policy on energy security.

As one minimum requirement, the Vilnius document proposes the “urgent priority that member countries inform each other and the [European] Commission about their intentions before concluding any bilateral agreements with third parties that could affect EU interests.” In this regard the document cites some member countries’ involvement in Russian projects that compete against EU-backed projects, such as Blue Stream and South Stream against Nabucco.

The summit’s recommendations ask the EU to intensify the energy dialogue with countries in the Caspian basin and Central Asia, “in the common interest of creating a Central Asia-South Caucasus-Black Sea energy corridor directly to Europe and diminishing dependence on Russian transit.” While acknowledging Russia’s irreplaceable role as energy supplier to Europe, the recommendations call for “solidarity [as] core principle to be followed in EU-Russia energy relations, only speaking in one voice. We must cooperate with Russia on the EU level, rather than on national levels.”

The document calls for inclusion of Ukraine, Moldova, Turkey, and South Caucasus countries in the EU-led Energy Community and Treaty, with its modern regulatory framework. It also proposes enhancing the energy aspects of the European Neighborhood Policy toward Central Asian countries in the Caspian basin. Such basic recommendations indirectly reflect the EU’s neglect of these issues during many years and the magnitude of opportunities to be retrieved. Some of the new member countries are spearheading this effort within the EU.

The summit communiqué singled out two primary threats to EU countries’ energy security: Russia’s initiatives to create an “OPEC for Gas” (see EDM, March 29, 30) and to turn the Baltic Sea into “another Bosporus” overcrowded with oil-tanker traffic (see EDM, March 7). It also forecast that Russia’s planned shift from overland routes to maritime routes for oil and gas exports would increase the costs to energy consumers. In a spirit of post-post-modern realism, the Vilnius communiqué calls for “strengthening the EU in the global competition for energy resources with Russia and China” and “ensur[ing] incentives to support strategic infrastructure projects that cannot be pursued solely on commercial terms.”

During the summit ministerial-level officials from Azerbaijan, Georgia, Ukraine, Poland, and Lithuania signed an agreement of intent on general cooperation for an energy transport corridor. This would include reversing the reversal of the Odessa-Brody pipeline, so as to use it in the originally intended mode, for Caspian oil south-north; and prolonging the pipeline into Poland to Plock and Gdansk. Attending the summit, Kazakhstan’s Energy and Natural Resources Minister Sauat Mynbayev did not sign that document and dashed expectations that Kazakhstan would supply that pipeline any time soon. In his speech to the summit, Mynbayev enumerated the massive commitments by Kazakhstan and western companies in the country to export oil via Russia, leaving very little for non-Russian routes such as Odessa-Brody. He concluded that even the “insignificant volumes” available would “significantly depend on Russia[‘s] approval.” And “any change of route for any volumes would have to be coordinated with Russia.”

Russian President Vladimir Putin had been invited to the Vilnius summit with due advance notice, but did not deign to attend. French President Nicolas Sarkozy had also been invited to Vilnius, but canceled at the last moment, snatched away by Putin for a visit to Moscow. There, Sarkozy agreed for French state-controlled energy companies to enter into cross-ownership arrangements with Russian state-controlled energy giants. This move unwittingly substantiated the Vilnius summit’s critique of energy policies within the EU. U.S. Secretary of State Condoleezza Rice, also invited to the Vilnius summit, bypassed it en route to Moscow for talks with Putin.

In an unprecedented step, Turkmenistan attended the Vilnius summit. Bayrammyrat Myradov, executive director of the State Agency for Management and Use of Hydrocarbon Resources under the President of Turkmenistan, implied in his speech that Turkmenistan was keeping some options open regarding the directions of gas exports.

(Vilnius Summit Documents, BNS, October 9-11)