The Nord Stream gas pipeline will empower Russia and harm Ukraine. The EU should act.
Published in Politico on 26.10.15
The decision of some German, Austrian, British, Dutch and French energy companies to do business with Gazprom must be severely lamented. Not only is it environmentally and economically wrong, it’s a brazen-faced dismissal of the principles of the intended European Energy Union, which are based on fair competition and solidarity.
Just a few years ago, the European Commission acted decisively and forbade the same companies to build a similar pipeline in southern Europe called South Stream. Now we are facing a lack of willingness to act because of the position of some member state governments; namely, Germany, France and Britain. That kind of majority would be difficult to challenge in the European Council, but it should be challenged nonetheless. A surprisingly heavy attack on the agreement made it onto the European Parliament plenary agenda thanks to the efforts of German MEP Reinhard Bütikofer, on October 7. But a resolution hasn’t yet been reached.
Germany, Europe’s economic powerhouse and one of the EU countries most addicted to Russian gas, came under siege from MEPs representing some of the smallest member states: Luxembourg, Cyprus and Estonia. Aided by a number of MEPs from Poland, Hungary, Romania, Greece, and Italy, they reproached the indifference of Berlin, Paris and London — and that of the European Commission.
How can these actors turn a blind eye to Nord Stream’s unambiguous goal to exclude Ukraine (and consequently Poland, Slovakia and others) from gas transit markets, delivering a quick and lethal blow to the survival of Ukraine’s already fragile economy, and indeed, to Commissioner Maroš Šefčovič’s efforts to facilitate a gas deal between Ukraine and Russia?
Economic data reveals that the Nord Stream pipeline is only working at half capacity because of a drop-off in demand for Russian gas. European energy companies have buckled under pressure from Gazprom — they only own 49 percent of the shares in the endeavor. To understand why they buckled, you have to consider the promises the Russians made, which probably include lucrative Artic drilling rights. Anyone can see that Gazprom’s reserves are too low to provide more gas than they are currently. Investments in research and infrastructure have been down for years and even with the best intentions, the Russian state-monopoly wouldn’t be able to invest because of its money being carelessly and relentlessly siphoned toward provocative military action in Syria. Hence their idea to apply some German-British capital to gas production in the Arctic.
Russian posturing around the North Pole may be attractive for business leaders, but they should take a closer look at the experience of British Petroleum in Russia. Assets can be declared the property of the Kremlin overnight. And, of course, they should bear in mind what happened to Khodorkovski. There’s no economic viability in the plan whatsoever.
We believe it’s not too late to apply common sense, and to return to the laborious, but worthwhile effort, of creating the European Energy Union, based on the diversification of energy supplies, energy efficiency and the increased use of European resources — especially renewable ones. But it will take determination from the European Council. That’s why we call on President of the European Council Donald Tusk to arrange a debate on this harmful project at the next meeting of heads of states and governments.
If he doesn’t, Nord Stream might present the same danger as the French plan to sell Mistral helicopter platforms to Putin. Russian admiral Vladimir Vysotskiy said that if he had had Mistral during the 2008 war in Georgia, the Black Sea fleet could have finished its mission in 40 minutes, instead of 26 hours. Within a year and a half, Nord Stream could see the end of Ukraine as an independent state.
Indrek Tarand is a Greens/European Free Alliance MEP. He previously served as the secretary-general of the Estonian ministry of foreign affairs.