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South Stream: Will one be able to enter through the other door?

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krutihin

The Russian administration is unwilling to become reconciled with failure of the South Stream project and is going to design an alternative route for the gas export.

The problem is that any route from Russia to the European consumers either through Turkey or Bulgaria will inevitably collide with the EU reality or necessity to observe the rules of competition at the energy carriers market – the norms of the so-called Third Energy Package. These norms do not allow the gas supplier to be the only owner of the pipeline and regulator of the infrastructure at the same time.

Refusal of the Russian monopoly to follow the EU rules had let to failure of the South Stream project.

The attempt to export gas through Turkey causes bewilderment. Turkey does not need as much gas as Gasprom promises to deliver via the future pipes and Black Sea or 63 billion cub.m. a year. They do not use the full amount of the gas, which they receive from the Russian coast through the Blue Stream. The major part of the promised volume will be transited further to the south of Europe through the future “gas distribution hub” on the Turkish-Greek border.

Trans-Anadolu (TANAP) gas pipeline from Azerbaijan is already aimed at this hub and on the other side of the border it will meet trans-Adriatic (TAP) gas pipeline to Albania and Italy. Here Gasprom will have to compete with Caspian gas (as well as Iraqi and Iranian gas in the future), which already has influential partners for sale and the international consortia for its transportation. If one has to lay the route through Bulgaria, then its fate will depend on the agreements with the European Commissars.

Observation of the Third Energy Package conditions will turn this gas pipeline into the common usage infrastructure, which is the same semi-forgotten European Nabucco route.

This will mean that the Russian company will build Nabucco at its own expense for “a strange person.”

Initially the project was designed for the political purpose as a method to punish Ukraine, which does not wish to follow the Russian government’s commands. Russia cannot deprive Ukraine of transit and according to Gasprom’s European clients, Ukraine fulfills its obligations to deliver Russian gas to the consumers in EU, Russian analyst Mikhail Krutikhin told Forbes magazine.

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