European Union foreign policy chief Javier Solana urged Moscow and Kiev to resume talks, as EU energy officials prepared to meet in Brussels on Wednesday to discuss the crisis. Europe imports a quarter of its natural gas consumption from Russia, and 90 percent of those imports are delivered via Ukraine.
Meeting in Kiev with ambassadors from the EU, Japan and the United States, President Viktor Yushchenko said Ukraine intended to call for international arbitration in the dispute.
Today, Russian Prime Minister Mikhail Fradkov asked the European Union Tuesday to influence Ukraine to ensure full and uninterrupted gas transit from Russia to the EU countries. "We are requesting to influence Ukraine to return to the legal norms and ensure the uninterrupted transit of natural gas across its territory to the countries of the European Union in compliance with its international obligations," the message said.
”Old Europe’s” EU member states have alternative solutions to the Russian gas crisis
"Gaz de France could buy from Norway and Algeria, and there are also reserves," he told Europe 1 radio, adding that a proportion of GDF's customers were able to switch from gas to fuel if requested to do so.
German gas companies EON Ruhrgas and Wingas also announced unquantified supply disruptions, but Economy Minister Michael Glos said there was no cause for concern for the 17 million German households that use gas heating.
"Thank God, we have sufficient reserves and we have contracts with many other gas-supplying countries," Glos told WDR radio.
Europe's largest economy, Germany imports 35 percent of its gas from Russia. In London, Energy Minister Malcolm Wicks told BBC radio Britain was "not a heavy importer of gas from Russia" and was unlikely to suffer any disruption. Britain, Denmark, Norway and the Netherlands produce their own gas, Sweden also uses North Sea production and Spain said it was unaffected by the dispute as it did not import Russian gas.
Greece, instead, is confronted with bigger problems as 79 percent of the country's gas was supplied by Russia. Managing Director of the Public Gas Corporation (DEPA) Asimakis Papageorgiou said that precautions were being taken. “We have secured an immediate increase in the amount of gas we receive from Algeria,” he said. Algeria supplies Greece with 20 percent of its gas.
Most of the Central and Eastern European countries depend on the Russian gas
It is worth mentioning that the states in Central and Eastern Europe region are mainly using Russian gas (that is transiting Ukraine): Slovakia - 100%; Bulgaria - 94%; Czech Republic - 73%; Hungary - 72%; Austria - 63%; Poland - 60%.
Russian gas imported by Romania covers about 40% of the country’s gas consumption, while home production would cover some 70% of the needs. Romania’s yearly gas consumption is about 18 billion cubic meters.
The yearly Gazprom supply for Germany is of 38 billion cubic meters, while France imports only 12 billion cubic meters.
China already increased gas price amid shortage fears
China has raised the price of natural gas in an apparent effort to ease demand as it tries to ensure fuel supplies for its energy-hungry economy.
Prices charged to factories and urban utility companies will rise by 5 percent to 10 percent, the Cabinet's National Development and Reform Commission (NDRC), the country's top economic planning agency, said Monday, Dec 26, 2005. Higher prices would be expected to slow growth in demand and spur domestic production of gas, which totaled about 45 billion cubic meters during the first 11 months of 2005.
The NDRC warned that natural gas demand will grow by 26 percent annually over the next five years, while production would rise by only 17 percent annually.
On Tuesday (Dec 27, 2005), the official China Securities Journal newspaper said China's natural gas import needs would likely reach 40-50 billion cubic meters per year by 2010 and twice that amount by 2020.
China has taken extraordinary measures in recent years to insure adequate supplies of energy for its booming economy — now the sixth largest in the world.
It signed a deal this year with the central Asian nation of Turkmenistan for gas imports and stepped up plans to build natural gas receiving plants along its booming east coast.
It has also sought greater access to Central Asian and Russian oil supplies. It opened an oil pipeline from Kazakhstan this month and is pressing Russian to speed up exports of Siberian oil via a planned pipeline to China.
Europe’s alternative gas sources
The most reliable alternative gas providers for Europe are Norway, Algeria, and possibly Nigeria.
Yesterday, anyhow, it became clear that Norway would have no possibilities to increase gas supplies to Europe if European consumers asked for that. Officials from major oil and gas companies of the country, Statoil and Hydro, also said they would not be able to increase gas supplies.
Norway is the biggest supplier of gas to Western Europe, daily exporting 270 million cubic meters of gas to Germany, France, Great Britain and Belgium. December 2005 saw an absolute record in the amount of Norwegian gas supplies to European consumers. Last year Norway sold about 81 billion cubic meters of gas.
Also, the trans-Mediterranean gas pipelines and LNG from Algeria and Libia are to be seen as viable solutions.
Nigeria is not to be forgotten. Recently, environmental groups estimate that Nigeria burns off almost half its 5 billion cubic feet of daily production because of a lack of gas-gathering networks. Edmund Daukoru, Nigeria's minister to the Organization of the Petroleum Exporting Countries, said that associated gas flaring in Nigeria had risen in absolute levels over the last two years. Royal Dutch Shell, Nigeria's largest oil producer, says it saw its absolute levels of associated gas flaring increase to 728 million cubic feet daily in 2004 from 570 million in 2002.
Romania Report & Sources
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