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The European Commission has drawn up plans to ensure that a new Russia-Germany gas pipeline – Nord Stream 2 – does not reshape EU energy markets for Russia`s strategic gain.
But the draft plan. a classified 10-page document seen by EUobserver. will only take effect if EU states give the green light. amid Germany`s likely preference for handling Nord Stream 2 talks with Russia without EU involvement.
The plan calls for an EU Council decision `authorising the opening of negotiations on an agreement between the European Union and the Russian Federation on the operation of the Nord Stream 2 pipeline`.
It says the agreement is to `ensure a coherent regulatory framework contributing to market functioning and security of supply`.
It also says the Commission should be the `head of the Union`s negotiating team`. but that it would conduct the Russia talks `in consultation` with `a special committee` of EU states` officials.
In what is likely to feel like poison in Russia`s ear. the 10-page paper insists. in an annex. that Nord Stream 2 should abide by EU laws on `unbundling` and `third party access`.
The unbundling law would force Russian state firm Gazprom. which owns both the gas and the future pipe. to cede control of Nord Stream 2 to an `independent … operator` in order to `avoid conflict of interests and to enhance competition`.
The third-party law would force Gazprom to allocate capacity on Nord Stream 2 to EU competitors `via regular transparent auctions` to prevent `market foreclosure` – a scenario in which Gazprom cuts off EU clients from gas supplies for financial or political motives.
The same demands were so toxic to Russia that they led it to abandon a pipeline project with Bulgaria. called South Stream. three years ago.
But the Commission annex adds a further proviso – that the Nord Stream 2 deal `should include appropriate measures` to ensure `sustainable long-term gas transit after 2019 along a number of existing supply routes. notably via Ukraine`.
It says those measures should also ensure that central and eastern European EU states are still able to `open up their gas markets` and `diversify their gas supplies` after Nord Stream 2 comes online in two years` time.
The EU imports most of its Russian gas via Ukraine Slovakia. Germany (the Nord Stream 1 pipeline). and Belarus Poland.
But if Nord Stream 2 is built. 80 percent of Russia`s gas would come via Germany. making Ukraine`s pipelines obsolete at a time when it is trying to align itself with the West. and `sharply` reducing gas supplies via Poland. one of Russia`s enemies in Europe.
`Current transit routes for Russian gas could to a large extent be replaced by a single dominant gas transportation corridor from Russia to Germany.` the Commission document said.
It said EU states such as Hungary. Poland. and Slovakia were building new infrastructure to enable them to import gas from western EU countries in order to reduce dependence on Russia.
But it said that if western states were fed more Russian gas via Nord Stream 2 it would `undermine` that effort to `diversify supply sources`.
It added that if Gazprom had a monopoly on operating Nord Stream 2 it would also `hamper the process of creating an open gas market with competitive prices` in the EU.
