Russia’s Energy Strategy Suffers a Major Setback

Courtesy European Dialogue

by Roman Kupchinsky

Has the European Union at long last found the wherewithal to stand up and draw the line on Vladimir Putin’s use of energy as a political weapon? At this week’s Ankara conference about the Nabucco pipeline, the EU displayed unusual tenacity and showed much needed foresight by engineering what many regard as a breakthrough agreement on finally beginning construction of Nabucco and filling it with gas from what many believe will be reliable suppliers. This measure, if implemented, would help stop Russia’s much touted South Stream pipeline project and begin to block the Kremlin’s strategy of using gas to further its foreign policy.

The July 13 conference in Ankara resulted in an agreement between the governments of Turkey, Austria and Hungary along with Bulgarian and Romanian energy companies to sign a long-awaited agreement to begin construction of Nabucco.

The newly elected Bulgarian Prime Minister Boyko Borisov played a major role in the agreement. By deciding on July 10 to suspend all negotiations about future deliveries of Russian gas to his country and put on hold Bulgaria’s role in the construction of the Russian South Stream gas pipeline project as well as to end the agreement with Russia to construct the Belene nuclear power plant, he effectively put Putin and his government on notice that business as usual had ended.

However, Ivan Danilin, an analyst for the “Regnum” website, does not believe that “Nabucco” has moved forward by any means. He claims that the suppliers have not signed on to the project and without them the signing ceremony is merely a cosmetic exercise.

Yet, last Friday, Baku and Ashgabat announced their willingness to participate in Nabucco. Turkmenistan for the first time also agreed to take part in the project. On July 10, the President of Turkmenistan Gurbanguly Berdimukhamedov announced “Currently, Turkmenistan has excess gas for trade. We are ready to send it abroad to any customer. This includes Nabucco.”

This poses major questions about the credibility of the head of Austria’s OMV Gas Company, a major player in Nabucco, Wolfgang Rittersdorf,who told Kommersant Daily on July 9, that Turkmenistan is not being considered as a supplier of gas to Nabucco in the near future.

When asked about the OMV sale of shares of the Hungarian company MOL to the secretive Russian company Surgutneftegaz, Rittersdorf refused to comment and redirected the questions to the Russian company, thereby raising more questions than answers.