MONTREAL - With potential ramifications
for the entire Euro-Caspian energy complex from
Central Asia to Central Europe, a new natural gas
strike has been made in Romania's offshore sector
of the Black Sea. This find will re-jig
calculations around the European Union's Southern
Gas Corridor while providing potential new sources
of energy for East Central and especially
Southeastern Europe.
In that context, the
potential for Romania to become a natural gas
exporter to Southeastern and even East Central
Europe comes into focus. The significance of the
Romanian strike concerns the eventual choice by
the consortium developing Azerbaijan's offshore
Shah Deniz natural gas deposit, between the
"western" (through Greece to Italy) route for its
10 billion cubic
meters per year (bcm/y)
gas and the "northern" (through Bulgaria to
Southeastern Europe) route.
Romanian
President Traian Basescu announced last week that
a consortium comprising the US major ExxonMobil
and the Romanian company Petrom (a subsidiary of
the Austrian OMV) has struck over 100 bcm of gas
in Romania's first deep-water offshore
exploration. He said this figure was subject to
revision upwards, since there were five other
geological formations in the area with
characteristics similar to the successful find. If
they all proved out the same way, the result would
give Romania over a half a trillion cubic meters
of offshore natural gas - equivalent to 25-30
years of total Romanian gas consumption at the
present rate, or 75-90 years worth of its gas
imports.
Separately in Bulgaria a week ago
it was announced that, in conformance with a
February 2011 decision by the EU's European
Council that every EU member state should have at
least two sources of natural gas and electricity,
the Bulgarian company Bulgartransgaz will
cooperate to build the transborder Interconnector
Bulgaria-Romania (IBR). Bulgaria imports most of
its gas from Russia, which cut off supplies for
three weeks in January 2009 and is thought to be
maneuvering within the Bulgarian political
environment to maintain its hegemonic position in
the Bulgarian gas market.
Thus while
according to the Bulgarian press agency Novinite
the US company Chevron will soon start drilling
for shale gas in the northeastern Romania around
Barlad, the Bulgarian cabinet recently made it
impossible for Chevron to develop shale gas in
Bulgaria by revoking an earlier awarded permit for
hydraulic fracturing ("fracking"). Bulgarian
environmental activists are now seeking
legislation to make that ban permanent.
In
response, an organization called Movement for
Energy Independence (DEN) has formed in Bulgaria
calling for the fracking moratorium to be
cancelled and for the until now dilatory work on
all interconnectors to be accelerated, including
the ITB, the IBR, and also the Interconnector
Greece-Bulgaria (IGB).
DEN also criticizes
the current government for enforcing Bulgaria's
gas dependence upon Russia by favoring the
Moscow-based South Stream gas pipeline project
(Moscow to Bulgaria under the Black Sea) and
seeking to help exempt Gazprom from oncoming EU
antitrust rules by accelerating the pipeline's
timetable.
The IBR, on the other hand, if
constructed to be bidirectionally reversible,
would make it possible not only for Bulgaria to
import Romanian gas directly from Romania, but
also to transit to Romania the gas that Bulgaria
might receive from Azerbaijan's offshore Shah
Deniz deposit via Georgia, Turkey, and the
Interconnector Turkey-Bulgaria (ITB) still under
construction.
An Interconnector
Turkey-Greece (ITG) is already operating, but the
Shah Deniz consortium has ruled out its extension
into the Interconnector Turkey-Greece-Italy (ITGI)
to Southern Europe via the Interconnector
Greece-Italy (IGI) across Greece and under the
Ionian Sea to Italy's geographical boot. (The
undersea segment by itself is called the Poseidon
pipeline.)
However, this does not mean
that the Shah Deniz consortium has ruled out
either the ITG or the separate Interconnector
Turkey-Bulgaria (ITB), should it choose a northern
rather than a western route for its gas. Given the
newly announced interconnector between Bulgaria
and Romania, either the ITG-IGB duo or the ITB by
itself would be able to hook up into Romanian
national pipeline system via the IBR.
The
Shah Deniz consortium has yet to choose between
the BP-proposed South East European Pipeline
(SEEP) or a reconfiguration of the Nabucco
pipeline project for the possible northern route.
After choosing one of those, it will then choose
between it and the designated western-route
pipeline, the Trans-Adriatic Pipeline (TAP), which
is set to cross Greece, Albania, and go underneath
the Adriatic Sea to Italy's boot.
Indeed,
earlier this week, the Bulgarian cabinet approved
the agreement between the Bulgarian company
Nabucco Gas Pipeline Bulgaria and the
international consortium Nabucco Gas Pipeline
International, signed in June 2011. The next step
is for the Bulgarian Parliament to ratify the
contract, following which the stages for
implementation of the Nabucco project in Bulgaria
may be further specified.
However, none of
this means that the ITGI or the IGI is dead. As a
consequence of the debt crisis in Greece, the
Greek principal in the IGI consortium, the public
gas company DEPA, is a candidate for
privatization; and Russia's Gazprom has shown an
interest.
The possibility of the IGI
segment transiting gas later in the decade from
Moscow's South Stream natural gas pipeline has
been discussed in the Greek press now for some
time. Sourcing problems, however, continue to
plague the South Stream project; Russia has never
said where any of its gas will come from.
Dr Robert M Cutler (http://www.robertcutler.org),
educated at the Massachusetts Institute of
Technology and The University of Michigan, has
researched and taught at universities in the
United States, Canada, France, Switzerland, and
Russia. Now senior research fellow in the
Institute of European, Russian and Eurasian
Studies, Carleton University, Canada, he also
consults privately in a variety of fields.
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