By Delphine Strauss and Ed Crooks
Iraq has offered to supply enough gas to fill half the capacity of the proposed Nabucco pipeline, the prime minister said, giving the project a boost even as heads of government met to sign a historic agreement approving the plan.
The offer from the Iraqi government to supply 15bn cubic metres a year of gas by 2015 helps address the greatest obstacle to the 3,300km pipeline from eastern Turkey to Austria: the prospect of there not being enough gas to fill it.
José Manuel Barroso, pre sident of the European Commission, said the signing of the Nabucco agreement in Ankara by the leaders of five countries on the pipeline’s route – Austria, Bulgaria, Hungary, Roman ia and Turkey – could “open the door to a new era in the relationship between the European Union and Tur key, and indeed beyond”.
Dick Lugar, the most senior Republican in the US senate, said the agreement was “a signal to the rest of the world that partner governments will not acquiesce to manipulation of energy supplies for political ends”.
Nabucco is intended to provide an alternative to Russian supplies, which have caused growing concern following the disruption caused by disputes be tween Russia and Ukraine.
The hope is that the inter-governmental agreement will convince gas-producing countries that the project – scheduled to start in 2014 – is closer to becoming reality than rival European or Russian-sponsored schemes, and persuade them to commit the volumes needed for commercial viability.
The only supplier that will definitely be ready for the first phase of the project is Azerbaijan, but it is juggling Nabucco’s de mands against those of Russia.
Richard Morningstar, US energy envoy, described Azeri gas as a “necessary condition” but not sufficient for the €8bn ($11bn, £7bn) Nabucco project.
If Iraq is able to achieve its ambition of supplying an annual 15bn cu m a year, it will fill almost half the pipeline’s 31bn cu m capacity.
International oil companies are interested in investing in the country to develop its resources, including gas.
The Kurdistan region in the north of Iraq has also attracted a planned investment by a consortium of companies including OMV of Austria and Mol of Hungary, which are both members of the Nabucco group.
Nabucco executives say significant quantities of gas could be available from those Kurdish fields as soon as next year.
Recep Tayyip Erdogan, the Turkish prime minister, also reiterated his desire for Iran to be a supplier “when conditions allow”, despite US opposition.
Andris Piebalgs, EU energy commissioner, said the EU’s focus now would be on encouraging Turkmenistan to participate. Stefan Judisch of Germany’s RWE, the energy group that is a member of the Nabucco consortium, said Turkmenistan would be able to supply an annual 10bn cu m in the pipeline’s first phase, but would first have to find a way through disputes over the Caspian Sea.
Gurbanguly Berdymukhammedov, president of Turkmenistan, said last week that participation in the project would help his country – which is locked in a dispute with Russia over gas supplies – to diversify its export routes.
Mr Piebalgs was optimistic about the consortium’s prospects of finding financing, saying: “If they have the gas, money will follow.”
However, there are fears that some companies in the consortium could struggle to finance their share of the pipeline – forcing them to accept a smaller share of its capacity.
Tuesday, July 14, 2009
Gas Pipeline in Turkey Gains European Backing
By SABRINA TAVERNISE and SEBNEM ARSU
A project for a gas pipeline that would reduce Europe’s dependence on Russian gas cleared a hurdle on Monday when four European governments signed an agreement with Turkey. But the project’s completion remained a distant goal, with no suppliers formally committed.
Government representatives of Austria, Bulgaria, Hungary, and Romania joined Turkish officials in Ankara, Turkey’s capital, to sign the pact, a transit agreement on the so-called Nabucco pipeline, which would stretch 2,000 miles from the Caspian Sea to Austria through Turkey.
The project has long been delayed, bogged down in disagreements between Turkey and Europe over terms and by maneuvers from Russia, which is pressing for a competing pipeline, South Stream. Most significantly, the pipeline has no committed suppliers, the most important element in getting the project moving.
The agreement signed Monday, which Turkey’s prime minister, Recep Tayyip Erdogan, was present for, was just one small step, experts said.
“It does very little to remove obstacles from the pipeline,” said Ana Jelenkovic, an analyst at Eurasia Group in London. “We have no map. There are no committed supplies, and no committed financing.”
The project was proposed in 2002 by executives of European energy companies wanting to reduce their reliance on Russian gas, which dominates Europe’s energy market. It took on new urgency in 2006 and again last winter, when pricing disputes between Ukraine and Russia shut down supplies to Europe.
Azerbaijan, an oil-rich American ally on the Caspian Sea, was seen as a potential principal supplier, though countries like Egypt and Iraq — as well as Iran, despite American objections — had also been discussed.
But geopolitics intervened last year, when Russia fought a short war with Georgia, giving other former Soviet satellites like Azerbaijan pause. In an indication of that concern, Azerbaijan last week signed an agreement to supply small amounts of natural gas to Russia, a promise that Ms. Jelenkovic said would not threaten the Nabucco pipeline.
Azerbaijan has also hit a rough spot in relations with Turkey, which is trying to reconcile with Armenia, its neighbor. Azerbaijan and Armenia fought a bitter war in the 1990s.
And Moscow has continued to seek support for its project. Just last week, Russia’s deputy prime minister, Igor Sechin, was quoted by the Interfax news agency as saying that Russia had “offered Turkey cooperation with the South Stream.”
Monday’s agreement does not address the sticking point between Turkey and Europe, Ms. Jelenkovic said. Turkey wants to keep 15 percent of the pipeline’s potential supply for its own markets or for resale, and European countries have balked at that.
Borit Grgoc, an expert on Caspian energy issues who has worked as a consultant to the Azeri government, said that European nations were unlikely to have an interest in allowing Turkey to “sell gas back to them.”
However, reports in the Turkish news media said that Turkey had agreed to lower its demand after partners in the consortium, along with RWE of Germany, offered a 50 to 60 percent share in tax revenues from the project, which could be worth up to $650 million.
A project for a gas pipeline that would reduce Europe’s dependence on Russian gas cleared a hurdle on Monday when four European governments signed an agreement with Turkey. But the project’s completion remained a distant goal, with no suppliers formally committed.
Government representatives of Austria, Bulgaria, Hungary, and Romania joined Turkish officials in Ankara, Turkey’s capital, to sign the pact, a transit agreement on the so-called Nabucco pipeline, which would stretch 2,000 miles from the Caspian Sea to Austria through Turkey.
The project has long been delayed, bogged down in disagreements between Turkey and Europe over terms and by maneuvers from Russia, which is pressing for a competing pipeline, South Stream. Most significantly, the pipeline has no committed suppliers, the most important element in getting the project moving.
The agreement signed Monday, which Turkey’s prime minister, Recep Tayyip Erdogan, was present for, was just one small step, experts said.
“It does very little to remove obstacles from the pipeline,” said Ana Jelenkovic, an analyst at Eurasia Group in London. “We have no map. There are no committed supplies, and no committed financing.”
The project was proposed in 2002 by executives of European energy companies wanting to reduce their reliance on Russian gas, which dominates Europe’s energy market. It took on new urgency in 2006 and again last winter, when pricing disputes between Ukraine and Russia shut down supplies to Europe.
Azerbaijan, an oil-rich American ally on the Caspian Sea, was seen as a potential principal supplier, though countries like Egypt and Iraq — as well as Iran, despite American objections — had also been discussed.
But geopolitics intervened last year, when Russia fought a short war with Georgia, giving other former Soviet satellites like Azerbaijan pause. In an indication of that concern, Azerbaijan last week signed an agreement to supply small amounts of natural gas to Russia, a promise that Ms. Jelenkovic said would not threaten the Nabucco pipeline.
Azerbaijan has also hit a rough spot in relations with Turkey, which is trying to reconcile with Armenia, its neighbor. Azerbaijan and Armenia fought a bitter war in the 1990s.
And Moscow has continued to seek support for its project. Just last week, Russia’s deputy prime minister, Igor Sechin, was quoted by the Interfax news agency as saying that Russia had “offered Turkey cooperation with the South Stream.”
Monday’s agreement does not address the sticking point between Turkey and Europe, Ms. Jelenkovic said. Turkey wants to keep 15 percent of the pipeline’s potential supply for its own markets or for resale, and European countries have balked at that.
Borit Grgoc, an expert on Caspian energy issues who has worked as a consultant to the Azeri government, said that European nations were unlikely to have an interest in allowing Turkey to “sell gas back to them.”
However, reports in the Turkish news media said that Turkey had agreed to lower its demand after partners in the consortium, along with RWE of Germany, offered a 50 to 60 percent share in tax revenues from the project, which could be worth up to $650 million.
Monday, July 13, 2009
Bosnia buries Srebrenica victims
The remains of 534 newly identified Bosniak Muslim victims of the Srebrenica massacre have been buried 14 years after the event.
Some 8,000 Bosniak Muslims, mainly men and boys, were killed by Bosnian Serbs near the town of Srebrenica in 1995 and buried in mass graves.
About 5,000 of the victims have been identified to date.
Thousands of mourners attended the ceremony, an annual reminder of the Bosniak Muslims' suffering in the war.
At the Potocari memorial cemetery just outside Srebrenica, in eastern Bosnia, victims' names were read out as coffins wrapped in green cloth were passed through the crowd.
"Although we were desperately searching for his remains for years, it was so hard to receive a telephone call telling us that my father had been identified," Nurveta Guster, 27, told AFP news agency.
"I saw him for the last time at our house in Srebrenica. He left with other men through the woods trying to escape."
Fugitive general
Srebrenica was attacked by Bosnian Serb forces on 11 July 1995, virtually ignoring Dutch UN troops who were stationed by the town, which had been designated a UN "safe haven".
The troops, operating under a restrictive UN mandate allowed Bosnian Serb forces into the town. Relatives of those killed have brought unsuccessful claims against the government of the Netherlands in an effort to claim compensation.
Speaking at the latest burial ceremony, Charles English, US Ambassador Bosnia-Hercegovina, said: "The world failed to act, failed to protect the innocent of Srebrenica."
Ranging in age from 14 to 72, most of latest victims to be buried were found in secondary mass graves where they had been moved from initial burial sites in a bid by Serb troops to cover up war crimes.
The International Court of Justice in The Hague, Netherlands, has ruled that the Srebrenica massacre was an act of genocide.
Former Bosnian Serb political leader Radovan Karadzic is currently on trial at the International Criminal Tribunal for the former Yugoslavia on genocide charges. He was arrested in 2008, but denies his guilt.
Gen Ratko Mladic, who led the Bosnian Serb troops involved in the killings, remains in hiding. He is said to be in Serbia.
Serbian President Boris Tadic has said his country is doing all it can to track him down and send him to The Hague.
The Bosniak people, most of whom are Muslims, first settled in Bosnia in the Middle Ages
Some 8,000 Bosniak Muslims, mainly men and boys, were killed by Bosnian Serbs near the town of Srebrenica in 1995 and buried in mass graves.
About 5,000 of the victims have been identified to date.
Thousands of mourners attended the ceremony, an annual reminder of the Bosniak Muslims' suffering in the war.
At the Potocari memorial cemetery just outside Srebrenica, in eastern Bosnia, victims' names were read out as coffins wrapped in green cloth were passed through the crowd.
"Although we were desperately searching for his remains for years, it was so hard to receive a telephone call telling us that my father had been identified," Nurveta Guster, 27, told AFP news agency.
"I saw him for the last time at our house in Srebrenica. He left with other men through the woods trying to escape."
Fugitive general
Srebrenica was attacked by Bosnian Serb forces on 11 July 1995, virtually ignoring Dutch UN troops who were stationed by the town, which had been designated a UN "safe haven".
The troops, operating under a restrictive UN mandate allowed Bosnian Serb forces into the town. Relatives of those killed have brought unsuccessful claims against the government of the Netherlands in an effort to claim compensation.
Speaking at the latest burial ceremony, Charles English, US Ambassador Bosnia-Hercegovina, said: "The world failed to act, failed to protect the innocent of Srebrenica."
Ranging in age from 14 to 72, most of latest victims to be buried were found in secondary mass graves where they had been moved from initial burial sites in a bid by Serb troops to cover up war crimes.
The International Court of Justice in The Hague, Netherlands, has ruled that the Srebrenica massacre was an act of genocide.
Former Bosnian Serb political leader Radovan Karadzic is currently on trial at the International Criminal Tribunal for the former Yugoslavia on genocide charges. He was arrested in 2008, but denies his guilt.
Gen Ratko Mladic, who led the Bosnian Serb troops involved in the killings, remains in hiding. He is said to be in Serbia.
Serbian President Boris Tadic has said his country is doing all it can to track him down and send him to The Hague.
The Bosniak people, most of whom are Muslims, first settled in Bosnia in the Middle Ages
Greek police flatten migrant camp
By Malcolm Brabant
Greek riot police have led an operation to demolish a makeshift camp housing illegal immigrants in the western port city of Patras.
The camp was used by migrants hoping to smuggle themselves onto ships bound for Italy and Western Europe.
Its closure is more proof of Greece's tougher stance on illegal immigration.
The camp had been a source of tension with many Greeks who regarded it as a major eyesore for themselves and for tourists arriving from Italy.
'Terrorising migrants'
About 100 riot police escorted bulldozers into the camp before dawn.
They levelled scores of cardboard and plastic hovels.
Only a makeshift mosque and a tent used by volunteer doctors were left untouched.
The camp in Patras had been in existence in some form or another for 13 years.
A few months ago, it accommodated about 1,800 people, mainly from Afghanistan.
But that number had dwindled to about 100 following large-scale arrests and also because the port authorities had made it nearly impossible to get on board ferries to Italy.
The early morning operation was described by Red Cross officials in Patras as "terrorising" the migrants.
One worker said it was designed to send a message to all illegal immigrants that they had no future in Greece.
'Migrant threat'
The conservative government in Athens has started taking tougher measures against the so-called "clandestines" in recent weeks, especially since the success of the right-wing nationalist Laos party in the European parliamentary election.
A new law has been passed which makes deportation easier.
Greece has been criticised internationally for its handling of would-be asylum seekers.
But recently the EU Justice Commissioner, Jacques Barrot, acknowledged that the "uncontrollable flow of immigration" posed a major threat to the equilibrium of Greek democracy.
The clampdown in Patras will push some migrants into the hands of traffickers in Athens and Italy who are demanding up to $8,000 (£4,940) for passage out of Greece.
Others have given up trying to catch a boat to Western Europe and have headed for Greece's land borders with Bulgaria and the former Yugoslav republic of Macedonia.
Greek riot police have led an operation to demolish a makeshift camp housing illegal immigrants in the western port city of Patras.
The camp was used by migrants hoping to smuggle themselves onto ships bound for Italy and Western Europe.
Its closure is more proof of Greece's tougher stance on illegal immigration.
The camp had been a source of tension with many Greeks who regarded it as a major eyesore for themselves and for tourists arriving from Italy.
'Terrorising migrants'
About 100 riot police escorted bulldozers into the camp before dawn.
They levelled scores of cardboard and plastic hovels.
Only a makeshift mosque and a tent used by volunteer doctors were left untouched.
The camp in Patras had been in existence in some form or another for 13 years.
A few months ago, it accommodated about 1,800 people, mainly from Afghanistan.
But that number had dwindled to about 100 following large-scale arrests and also because the port authorities had made it nearly impossible to get on board ferries to Italy.
The early morning operation was described by Red Cross officials in Patras as "terrorising" the migrants.
One worker said it was designed to send a message to all illegal immigrants that they had no future in Greece.
'Migrant threat'
The conservative government in Athens has started taking tougher measures against the so-called "clandestines" in recent weeks, especially since the success of the right-wing nationalist Laos party in the European parliamentary election.
A new law has been passed which makes deportation easier.
Greece has been criticised internationally for its handling of would-be asylum seekers.
But recently the EU Justice Commissioner, Jacques Barrot, acknowledged that the "uncontrollable flow of immigration" posed a major threat to the equilibrium of Greek democracy.
The clampdown in Patras will push some migrants into the hands of traffickers in Athens and Italy who are demanding up to $8,000 (£4,940) for passage out of Greece.
Others have given up trying to catch a boat to Western Europe and have headed for Greece's land borders with Bulgaria and the former Yugoslav republic of Macedonia.
Europe gas line deal to be signed
By David O'Byrne
Four European countries are meeting in Turkey to sign a five-nation agreement for the long-planned 3,300km Nabucco natural gas pipeline.
Once completed, the line will bring up to 31 billion cubic metres of gas a year from the Caspian and the Middle East across Turkey and into Europe.
It will give an important alternative energy supply to Russia, which already meets 30% of Europe's gas needs.
But much still remains to be agreed on, not least where the gas will come from.
Long-running project
The five countries - Turkey, Romania, Bulgaria, Hungary and Austria - have been working on the Nabucco project with the European Commission for seven years now.
But still the decision to sign the heads of government agreement on 13 July has come as a surprise.
To begin with there is still no clear idea as to what has been agreed.
Turkey and the European Commission are still at loggerheads over how much gas Turkey will be able to take from the line, with Ankara claiming that it might be another six months before a final agreement is reached.
Supply issues
More worrying still, Nabucco still has no guaranteed supply of gas.
Iran, Iraq, Kazakhstan, Turkmenistan and Egypt are all considered potential suppliers in the long term.
Currently though, only Azerbaijan is in a position to supply the 15 billion cubic metres a year the line needs if it is to be constructed as planned by 2014.
But two weeks ago, Baku agreed to sell some of that gas to Russia, a move many understood as a warning to the Nabucco partners to sort out their differences or look elsewhere.
In the same way, Monday's signing ceremony is being seen as largely an attempt to persuade Baku that the Nabucco partners can reach an agreement, on some issues at least.
At the same time, Russia is planning its own new gas pipeline to Europe, the Nord Stream, which will run direct from Russia to Germany under the Baltic Sea.
Four European countries are meeting in Turkey to sign a five-nation agreement for the long-planned 3,300km Nabucco natural gas pipeline.
Once completed, the line will bring up to 31 billion cubic metres of gas a year from the Caspian and the Middle East across Turkey and into Europe.
It will give an important alternative energy supply to Russia, which already meets 30% of Europe's gas needs.
But much still remains to be agreed on, not least where the gas will come from.
Long-running project
The five countries - Turkey, Romania, Bulgaria, Hungary and Austria - have been working on the Nabucco project with the European Commission for seven years now.
But still the decision to sign the heads of government agreement on 13 July has come as a surprise.
To begin with there is still no clear idea as to what has been agreed.
Turkey and the European Commission are still at loggerheads over how much gas Turkey will be able to take from the line, with Ankara claiming that it might be another six months before a final agreement is reached.
Supply issues
More worrying still, Nabucco still has no guaranteed supply of gas.
Iran, Iraq, Kazakhstan, Turkmenistan and Egypt are all considered potential suppliers in the long term.
Currently though, only Azerbaijan is in a position to supply the 15 billion cubic metres a year the line needs if it is to be constructed as planned by 2014.
But two weeks ago, Baku agreed to sell some of that gas to Russia, a move many understood as a warning to the Nabucco partners to sort out their differences or look elsewhere.
In the same way, Monday's signing ceremony is being seen as largely an attempt to persuade Baku that the Nabucco partners can reach an agreement, on some issues at least.
At the same time, Russia is planning its own new gas pipeline to Europe, the Nord Stream, which will run direct from Russia to Germany under the Baltic Sea.
Friday, July 10, 2009
Transit states release tension on Nabucco
By Ed Crooks and Delphine Strauss
Nabucco, the ambitious pipeline proposal to bring natural gas to the European Union from the Caspian region, will pass its first significant milestone on Monday when an inter governmental agreement between the project’s backers is signed.
Turkey, where the pipeline is intended to start, had been obstructing a deal but a solution has been found to meet the country’s demands for security of supply without making a legal commitment to provide it with a fixed amount of gas.
A crisis in January caused by a gas dispute between Russia and Ukraine gave momentum to the slow-moving Nabucco project, reinforcing European consumers’ view of the need for alternative supply routes and sources of gas.
Many European industry executives and officials now believe the pipeline is likely to go ahead at last.
However, the commercial prospects for Nabucco still look highly uncertain because of a shortage of readily available gas supplies and competition from cheaper and quicker projects. If it is to be built, it is likely to require further support from member states and the EU.
The intergovernmental agreement is set to be signed in Ankara on Monday by the five transit countries – Turkey, Austria, Hungary, Romania and Bulgaria. Energy companies from those five countries make up the Nabucco consortium, along with RWE of Germany.
Turkey has been demanding it should be able to buy 15 per cent of Nabucco’s gas for its domestic use or for re-export. For now, that demand appears to have been shelved.
Instead, Ankara has been promised other guarantees of security of gas supply, such as a commitment that the pipeline will be built so that gas can flow in both directions. In emergencies such as the Russia-Ukraine dispute, it would be able to call on stockpiles of gas held in the EU.
But while the politicians may now be in agreement, the business case to support the €8bn ($11bn, £7bn) investment to build a 3,300km pipeline is more tenuous.
The demand is certainly there. A year ago, companies interested in using Nabucco made non-binding bids for 100 per cent of its capacity from its earliest planned start date of 2013.
The problem is the lack of gas to fill it. The only country that can definitely supply Nabucco from the start is Azerbaijan, which will begin production from the large Shah Deniz 2 project in the next decade.
However, that gas is also sought by two other planned pipelines running from Greece to Italy: the Interconnector Turkey Greece Italy (ITGI) and the trans-Adriatic pipeline (TAP). Umberto Quadrino, the chief executive of Edison, the Italian energy company that backs ITGI, says: “This pipeline can be realised much more easily. There is just a small infrastructure investment. Nabucco is much more complex and more gas is needed.”
ITGI would have about 8bn cubic metres per year going to Italy, compared with Nabucco’s planned maximum capacity of 31bn cubic metres per year.
For Nabucco, Iraq is a promising source of gas, following the plan announced in May for Mol of Hungary and OMV of Austria, partners in the pipeline, to invest $8bn in developing gas production in the Kurdistan region of northern Iraq.
Gas-rich Turkmenistan, locked in a gas dispute with Russia and likely to look favourably on alternative export routes, would be another source if the problem of crossing the Caspian could be solved. If ITGI goes ahead, however, it will take away the cheapest and quickest source of supply for Nabucco.
If the latter pipeline is built, it will encourage investment in gas production and so, eventually, it is likely the supply will come. That would mean the pipeline being used at less than full capacity for many years. But Jonathan Stern of the Oxford Institute for Energy Studies believes the political will may now be there to do that.
“European governments will just have to encourage their utilities to back Nabucco,” he says. “They will say ‘this is a test of EU energy policy and a test of European solidarity, and you have got to do it’.”
Next steps
Securing an intergovernmental agreement is only the first step on the road to taking a final decision to proceed with Nabucco. The next steps will be:
● Completing the engineering design work, which will be the basis for the environmental impact assessment.
● Signing agreements with natural gas trading companies to book capacity on the pipeline. The gas traders will be trying to agree deals with the supply countries, likely to be Azerbaijan, Iraq and Egypt for the first phase, and then possibly Turkmenistan for the second phase.
● Securing financing. The European Commission has promised €200m ($280m, £170m) of stimulus funding, but that is only a fraction of the project’s estimated cost of about €8bn.
The European Investment Bank has said it is prepared to finance up to 25 per cent of the pipeline’s cost, implying a further commitment of €2bn.
Commercial funding should be relatively easy to secure once the capacity is booked, because the gas transit fees are reliable revenues.
The problem will be in securing the gas to be transported.
Once those elements are in place, the Nabucco consortium says that it will be able to take the final investment decision, which is scheduled for the first quarter of next year.
It can then begin to sign contracts with contractors, steel providers and other suppliers. Construction could begin next year.
Nabucco, the ambitious pipeline proposal to bring natural gas to the European Union from the Caspian region, will pass its first significant milestone on Monday when an inter governmental agreement between the project’s backers is signed.
Turkey, where the pipeline is intended to start, had been obstructing a deal but a solution has been found to meet the country’s demands for security of supply without making a legal commitment to provide it with a fixed amount of gas.
A crisis in January caused by a gas dispute between Russia and Ukraine gave momentum to the slow-moving Nabucco project, reinforcing European consumers’ view of the need for alternative supply routes and sources of gas.
Many European industry executives and officials now believe the pipeline is likely to go ahead at last.
However, the commercial prospects for Nabucco still look highly uncertain because of a shortage of readily available gas supplies and competition from cheaper and quicker projects. If it is to be built, it is likely to require further support from member states and the EU.
The intergovernmental agreement is set to be signed in Ankara on Monday by the five transit countries – Turkey, Austria, Hungary, Romania and Bulgaria. Energy companies from those five countries make up the Nabucco consortium, along with RWE of Germany.
Turkey has been demanding it should be able to buy 15 per cent of Nabucco’s gas for its domestic use or for re-export. For now, that demand appears to have been shelved.
Instead, Ankara has been promised other guarantees of security of gas supply, such as a commitment that the pipeline will be built so that gas can flow in both directions. In emergencies such as the Russia-Ukraine dispute, it would be able to call on stockpiles of gas held in the EU.
But while the politicians may now be in agreement, the business case to support the €8bn ($11bn, £7bn) investment to build a 3,300km pipeline is more tenuous.
The demand is certainly there. A year ago, companies interested in using Nabucco made non-binding bids for 100 per cent of its capacity from its earliest planned start date of 2013.
The problem is the lack of gas to fill it. The only country that can definitely supply Nabucco from the start is Azerbaijan, which will begin production from the large Shah Deniz 2 project in the next decade.
However, that gas is also sought by two other planned pipelines running from Greece to Italy: the Interconnector Turkey Greece Italy (ITGI) and the trans-Adriatic pipeline (TAP). Umberto Quadrino, the chief executive of Edison, the Italian energy company that backs ITGI, says: “This pipeline can be realised much more easily. There is just a small infrastructure investment. Nabucco is much more complex and more gas is needed.”
ITGI would have about 8bn cubic metres per year going to Italy, compared with Nabucco’s planned maximum capacity of 31bn cubic metres per year.
For Nabucco, Iraq is a promising source of gas, following the plan announced in May for Mol of Hungary and OMV of Austria, partners in the pipeline, to invest $8bn in developing gas production in the Kurdistan region of northern Iraq.
Gas-rich Turkmenistan, locked in a gas dispute with Russia and likely to look favourably on alternative export routes, would be another source if the problem of crossing the Caspian could be solved. If ITGI goes ahead, however, it will take away the cheapest and quickest source of supply for Nabucco.
If the latter pipeline is built, it will encourage investment in gas production and so, eventually, it is likely the supply will come. That would mean the pipeline being used at less than full capacity for many years. But Jonathan Stern of the Oxford Institute for Energy Studies believes the political will may now be there to do that.
“European governments will just have to encourage their utilities to back Nabucco,” he says. “They will say ‘this is a test of EU energy policy and a test of European solidarity, and you have got to do it’.”
Next steps
Securing an intergovernmental agreement is only the first step on the road to taking a final decision to proceed with Nabucco. The next steps will be:
● Completing the engineering design work, which will be the basis for the environmental impact assessment.
● Signing agreements with natural gas trading companies to book capacity on the pipeline. The gas traders will be trying to agree deals with the supply countries, likely to be Azerbaijan, Iraq and Egypt for the first phase, and then possibly Turkmenistan for the second phase.
● Securing financing. The European Commission has promised €200m ($280m, £170m) of stimulus funding, but that is only a fraction of the project’s estimated cost of about €8bn.
The European Investment Bank has said it is prepared to finance up to 25 per cent of the pipeline’s cost, implying a further commitment of €2bn.
Commercial funding should be relatively easy to secure once the capacity is booked, because the gas transit fees are reliable revenues.
The problem will be in securing the gas to be transported.
Once those elements are in place, the Nabucco consortium says that it will be able to take the final investment decision, which is scheduled for the first quarter of next year.
It can then begin to sign contracts with contractors, steel providers and other suppliers. Construction could begin next year.
Thursday, July 2, 2009
Iran Seeks to Close Door on Further Protests
By MICHAEL SLACKMAN
CAIRO — Police officers and militia forces crowded the streets of Tehran on Tuesday, setting up checkpoints and making clear that the government had zero tolerance for any further public expressions of defiance to the re-election of President Mahmoud Ahmadinejad, a day after Iran’s powerful Guardian Council certified his landslide victory.
The government made a series of official moves to close the book on weeks of protest that represented the strongest challenge to its control since the Islamic republic was founded in 1979. Parliament issued a statement expressing broad gratitude over the June 12 vote and thanking the police and the Basij militia for maintaining security. Mr. Ahmadinejad visited the Ministry of Intelligence, where he gave a speech to employees.
The government crushed the vast protests following the vote, dispatching armed militia and police officers and leaving an estimated 17 people dead and hundreds injured. The authorities continued to detain hundreds of journalists, former government officials, political activists and even independent researchers, in the quest to prevent any further demonstrations.
There seemed little prospect of any chance for organized and sustained action against the government’s version of events, political analysts said, in part because the arrests had starved the opposition of leadership, foot soldiers and an effective means to communicate.
One of the most recent arrests, of Bijan Khajehpour, an independent political economist, sent a chill deeper yet into Iran’s civil society because he had not been involved in the opposition demonstrations, political analysts said.
Mr. Khajehpour had been detained at the airport coming into the country from Britain, and like many others, has disappeared into the notorious Evin prison, raising concerns over the scope of the crackdown and the prospect of a political purge, the analysts said.
“Bijan was perhaps the last independent-minded analyst living in Tehran who continued to travel to Europe and the U.S. and give open lectures about Iran,” said Karim Sadjadpour, an Iran expert with the Carnegie Endowment for International Peace. “He always believed that if he was totally transparent, the government would understand he was not doing anything wrong.”
The government has also, over the past several days, fired high-ranking officials who had supported Mir Hussein Moussavi, the president’s main challenger, according to Iranian news reports.
Human rights groups said arrests had taken place around the nation, but there were particular fears that those held at Evin were in physical danger.
Amnesty International said in a statement that it was “gravely concerned that several opposition leaders detained in the wake of the 12 June elections may be facing torture, possibly to force them to make televised ‘confessions’ as a prelude to unfair trials in which they could face the death penalty.”
Reporters Without Borders, a press freedom organization, said that the concern extended beyond opposition leaders. “Several witness accounts makes us fear that torture and ill treatment are being systematically inflicted on prisoners who have demonstrated against the regime,” the group said in a statement. “Several journalists and bloggers were brutally treated by the guards and by men employed by the state prosecutor Saeed Mortazavi.”
The Guardian Council’s validation of the election on Monday followed days of promises that a committee would be formed to review the election and that a partial recount would occur. But the committee was never seated, nor was the review process established.
The recount involved what officials said was a random 10 percent of ballots in Tehran’s 22 electoral districts and in some provinces. The officials concluded that in some areas, Mr. Ahmadinejad had won even more votes than initially stated.
With the vote now officially over, the government pressed forward with its efforts to rewrite a narrative of events that had been cast first by the millions who took to the streets, and then through independent and citizen journalism. The government has made reporting inside the country impossible, forcing foreign journalists to leave, while arresting and threatening Iranians who challenge the government’s position.
The government maintains that Western agents, primarily Britons, have been responsible for the unrest. On Monday, the government sought to recast blame for the deaths of about 17 protesters.
The commander of Iran’s Basij militia, Hossein Taeb, said that impostors wearing Basij uniforms had been responsible for infiltrating crowds attacking unarmed citizens. He also suggested that a Basij impostor had been responsible for killing Neda Agha-Soltan, the young woman who became an international symbol when video of her shot and dying in the street went on the Internet and was seen around the world.
CAIRO — Police officers and militia forces crowded the streets of Tehran on Tuesday, setting up checkpoints and making clear that the government had zero tolerance for any further public expressions of defiance to the re-election of President Mahmoud Ahmadinejad, a day after Iran’s powerful Guardian Council certified his landslide victory.
The government made a series of official moves to close the book on weeks of protest that represented the strongest challenge to its control since the Islamic republic was founded in 1979. Parliament issued a statement expressing broad gratitude over the June 12 vote and thanking the police and the Basij militia for maintaining security. Mr. Ahmadinejad visited the Ministry of Intelligence, where he gave a speech to employees.
The government crushed the vast protests following the vote, dispatching armed militia and police officers and leaving an estimated 17 people dead and hundreds injured. The authorities continued to detain hundreds of journalists, former government officials, political activists and even independent researchers, in the quest to prevent any further demonstrations.
There seemed little prospect of any chance for organized and sustained action against the government’s version of events, political analysts said, in part because the arrests had starved the opposition of leadership, foot soldiers and an effective means to communicate.
One of the most recent arrests, of Bijan Khajehpour, an independent political economist, sent a chill deeper yet into Iran’s civil society because he had not been involved in the opposition demonstrations, political analysts said.
Mr. Khajehpour had been detained at the airport coming into the country from Britain, and like many others, has disappeared into the notorious Evin prison, raising concerns over the scope of the crackdown and the prospect of a political purge, the analysts said.
“Bijan was perhaps the last independent-minded analyst living in Tehran who continued to travel to Europe and the U.S. and give open lectures about Iran,” said Karim Sadjadpour, an Iran expert with the Carnegie Endowment for International Peace. “He always believed that if he was totally transparent, the government would understand he was not doing anything wrong.”
The government has also, over the past several days, fired high-ranking officials who had supported Mir Hussein Moussavi, the president’s main challenger, according to Iranian news reports.
Human rights groups said arrests had taken place around the nation, but there were particular fears that those held at Evin were in physical danger.
Amnesty International said in a statement that it was “gravely concerned that several opposition leaders detained in the wake of the 12 June elections may be facing torture, possibly to force them to make televised ‘confessions’ as a prelude to unfair trials in which they could face the death penalty.”
Reporters Without Borders, a press freedom organization, said that the concern extended beyond opposition leaders. “Several witness accounts makes us fear that torture and ill treatment are being systematically inflicted on prisoners who have demonstrated against the regime,” the group said in a statement. “Several journalists and bloggers were brutally treated by the guards and by men employed by the state prosecutor Saeed Mortazavi.”
The Guardian Council’s validation of the election on Monday followed days of promises that a committee would be formed to review the election and that a partial recount would occur. But the committee was never seated, nor was the review process established.
The recount involved what officials said was a random 10 percent of ballots in Tehran’s 22 electoral districts and in some provinces. The officials concluded that in some areas, Mr. Ahmadinejad had won even more votes than initially stated.
With the vote now officially over, the government pressed forward with its efforts to rewrite a narrative of events that had been cast first by the millions who took to the streets, and then through independent and citizen journalism. The government has made reporting inside the country impossible, forcing foreign journalists to leave, while arresting and threatening Iranians who challenge the government’s position.
The government maintains that Western agents, primarily Britons, have been responsible for the unrest. On Monday, the government sought to recast blame for the deaths of about 17 protesters.
The commander of Iran’s Basij militia, Hossein Taeb, said that impostors wearing Basij uniforms had been responsible for infiltrating crowds attacking unarmed citizens. He also suggested that a Basij impostor had been responsible for killing Neda Agha-Soltan, the young woman who became an international symbol when video of her shot and dying in the street went on the Internet and was seen around the world.
Bosnia echoes to alarming rhetoric
By Paul Moss
Radio 4's The World Tonight
They may have disagreed about politics, but the group of 20-something friends who had gathered for an after-work drink were all certain about one thing - they were Serbs.
"My father is a Serb, my grandfather is a Serb, I am a Serb. This is my nationality," said Vladislav.
"If we are looking at a football game," added Bane, "Serbia against somebody else, we are fans of Serbia."
These would not have been particularly notable declarations of identity, save for one crucial fact.
We were speaking in Banja Luka, a city in Bosnia, and all these people were Bosnian citizens.
But that meant little to Ivana, a trainee architect: "Bosnia is an artificial and silly creation, we naturally belong with Serbs," she said.
That "creation" was born out of the ruins of battle.
“ Everybody should be worried, this is the Balkans, and nationalist rhetoric here always leads to war ”
Svetlana Cenic, writer
At the end of the Bosnian Civil War, it was agreed that the country would remain a single nation.
However, the Serbs were granted their own officially-recognised region, known as the Republika Srpska.
It has its own parliament, and a fair degree of autonomy.
But now some fear this delicate constitutional compromise could be falling apart.
'Thinly-veiled threats'
The Republika Srpska parliament has issued a declaration, insisting that it has the right to make its own rules in certain key areas, like immigration and customs.
That move was vetoed this week by Bosnia's High Representative, the internationally-appointed figure who still has executive authority in the country.
But the resulting row has left many worried about the country's stability.
"The way the Serb politicians speak is getting more and more nationalistic," says Svetlana Cenic, a writer and newspaper columnist.
"Everybody should be worried," she warns. "This is the Balkans, and nationalist rhetoric here always leads to war."
Svetlana and others are particularly alarmed by the pronouncements of the Bosnian Serb Prime Minister, Milorad Dodik.
He has made thinly-veiled threats that the Republika Srpska might secede from Bosnia altogether.
Any attempt at secession by the Republika Srpska would be seriously destabilising.
It would alarm the many ethnic Croats who still live in the region, as well as the Muslim population, known as Bosniaks.
It might also tempt the Croat region of Bosnia to contemplate a similar move towards independence.
But more than anything, secession would be resisted by the remaining part of Bosnia, with its capital in Sarajevo.
Hundreds of thousands of non-Serbs now live there, having been driven out of what is now the Republika Srpska during the Civil War.
'Betrayed'
And for those who remember this experience, like the actress Alena Dzebo-heco, independence for the Republika Srpska would be a moral outrage.
"The people who did the ethnic cleansing, they would get what they wanted," she argues.
"After everything my family went through - my uncle was in a concentration camp, my father was arrested.
"We would feel betrayed."
The ruling party in the Republika Srpska, the SNSD, has been playing down fears that it plans to secede - at least any time soon.
The speaker of the parliament, Igor Radojicic, said Mr Dodik, his party leader, was only responding to threats from Bosniaks.
He argues that they would like to take away the Republika Srpska's powers, and rule the whole of Bosnia directly.
"The fact is that Serbs are a minority in Bosnia, approximately one-third.
"There are fears that the Muslims might make decisions in favour of their ethnic group. So we are fighting to protect our autonomy."
There is certainly plenty of fear in the Republika Srpska that Muslims pose a threat.
They range from the kind of sober political argument advanced by the Parliamentary Speaker, to more lurid anxieties, whipped up in part by sensationalist newspapers.
"Osama Bin Laden has operations in Sarajevo," one well-educated man told me.
Others insisted that the Serbs were in the vanguard of the struggle against Islamic fundamentalism - this despite the fact that Bosnian Muslims tend to be relatively non-observant.
It is 17 years since the Bosnian Civil War began, sparked off by each different ethnic group believing that the others were trying to take over, and that they had to fight back.
The risk is that these fears, and the inflammatory rhetoric that tends to drive them, may be gaining ground once again.
Radio 4's The World Tonight
They may have disagreed about politics, but the group of 20-something friends who had gathered for an after-work drink were all certain about one thing - they were Serbs.
"My father is a Serb, my grandfather is a Serb, I am a Serb. This is my nationality," said Vladislav.
"If we are looking at a football game," added Bane, "Serbia against somebody else, we are fans of Serbia."
These would not have been particularly notable declarations of identity, save for one crucial fact.
We were speaking in Banja Luka, a city in Bosnia, and all these people were Bosnian citizens.
But that meant little to Ivana, a trainee architect: "Bosnia is an artificial and silly creation, we naturally belong with Serbs," she said.
That "creation" was born out of the ruins of battle.
“ Everybody should be worried, this is the Balkans, and nationalist rhetoric here always leads to war ”
Svetlana Cenic, writer
At the end of the Bosnian Civil War, it was agreed that the country would remain a single nation.
However, the Serbs were granted their own officially-recognised region, known as the Republika Srpska.
It has its own parliament, and a fair degree of autonomy.
But now some fear this delicate constitutional compromise could be falling apart.
'Thinly-veiled threats'
The Republika Srpska parliament has issued a declaration, insisting that it has the right to make its own rules in certain key areas, like immigration and customs.
That move was vetoed this week by Bosnia's High Representative, the internationally-appointed figure who still has executive authority in the country.
But the resulting row has left many worried about the country's stability.
"The way the Serb politicians speak is getting more and more nationalistic," says Svetlana Cenic, a writer and newspaper columnist.
"Everybody should be worried," she warns. "This is the Balkans, and nationalist rhetoric here always leads to war."
Svetlana and others are particularly alarmed by the pronouncements of the Bosnian Serb Prime Minister, Milorad Dodik.
He has made thinly-veiled threats that the Republika Srpska might secede from Bosnia altogether.
Any attempt at secession by the Republika Srpska would be seriously destabilising.
It would alarm the many ethnic Croats who still live in the region, as well as the Muslim population, known as Bosniaks.
It might also tempt the Croat region of Bosnia to contemplate a similar move towards independence.
But more than anything, secession would be resisted by the remaining part of Bosnia, with its capital in Sarajevo.
Hundreds of thousands of non-Serbs now live there, having been driven out of what is now the Republika Srpska during the Civil War.
'Betrayed'
And for those who remember this experience, like the actress Alena Dzebo-heco, independence for the Republika Srpska would be a moral outrage.
"The people who did the ethnic cleansing, they would get what they wanted," she argues.
"After everything my family went through - my uncle was in a concentration camp, my father was arrested.
"We would feel betrayed."
The ruling party in the Republika Srpska, the SNSD, has been playing down fears that it plans to secede - at least any time soon.
The speaker of the parliament, Igor Radojicic, said Mr Dodik, his party leader, was only responding to threats from Bosniaks.
He argues that they would like to take away the Republika Srpska's powers, and rule the whole of Bosnia directly.
"The fact is that Serbs are a minority in Bosnia, approximately one-third.
"There are fears that the Muslims might make decisions in favour of their ethnic group. So we are fighting to protect our autonomy."
There is certainly plenty of fear in the Republika Srpska that Muslims pose a threat.
They range from the kind of sober political argument advanced by the Parliamentary Speaker, to more lurid anxieties, whipped up in part by sensationalist newspapers.
"Osama Bin Laden has operations in Sarajevo," one well-educated man told me.
Others insisted that the Serbs were in the vanguard of the struggle against Islamic fundamentalism - this despite the fact that Bosnian Muslims tend to be relatively non-observant.
It is 17 years since the Bosnian Civil War began, sparked off by each different ethnic group believing that the others were trying to take over, and that they had to fight back.
The risk is that these fears, and the inflammatory rhetoric that tends to drive them, may be gaining ground once again.
Greece acts to stub out smoking
Greece has introduced a ban on smoking in hospitals, schools, vehicles and all public places.
Those who break the new law face fines of up to 500 euros (£428), and businesses risk losing licences after several offences.
Greece is the EU's heaviest-smoking nation - 40% of the population smokes.
But defying the authorities is a national sport and there is no guarantee the ban will succeed, a BBC correspondent in Athens says.
'Moment of truth'
Small cafes and restaurants with premises measuring less than 70 square metres can choose either to be tobacco-free or to admit only patrons who smoke, our correspondent Malcolm Brabant says.
Bigger establishments can have clearly identified and ventilated smoking areas.
In order to give teeth to the new regulations, which came into force on 1 July, smokers who break the law can be fined up to 500 euros.
On the first offence, businesses will be fined 1,000 euros. Repeat offenders will face even bigger fines, and ultimately, on the fourth violation, could risk losing their licence.
Each year, 20,000 Greeks die from tobacco-related illnesses and the cost in terms of health care amounts to some 1.5bn euros.
Many workers are exposed to passive smoking.
Greek Health Minister Dimitris Avromopoulos has said the moment of truth has arrived, with the ban aiming to revolutionise people's outlook.
But many Greeks regard the new law as an infringement of civil liberties, our correspondent says.
He says that in the face of widespread civil disobedience, successive governments have always had a problem enforcing new legislation.
And so despite the tough talk, there is no guarantee that the new measures will succeed.
Those who break the new law face fines of up to 500 euros (£428), and businesses risk losing licences after several offences.
Greece is the EU's heaviest-smoking nation - 40% of the population smokes.
But defying the authorities is a national sport and there is no guarantee the ban will succeed, a BBC correspondent in Athens says.
'Moment of truth'
Small cafes and restaurants with premises measuring less than 70 square metres can choose either to be tobacco-free or to admit only patrons who smoke, our correspondent Malcolm Brabant says.
Bigger establishments can have clearly identified and ventilated smoking areas.
In order to give teeth to the new regulations, which came into force on 1 July, smokers who break the law can be fined up to 500 euros.
On the first offence, businesses will be fined 1,000 euros. Repeat offenders will face even bigger fines, and ultimately, on the fourth violation, could risk losing their licence.
Each year, 20,000 Greeks die from tobacco-related illnesses and the cost in terms of health care amounts to some 1.5bn euros.
Many workers are exposed to passive smoking.
Greek Health Minister Dimitris Avromopoulos has said the moment of truth has arrived, with the ban aiming to revolutionise people's outlook.
But many Greeks regard the new law as an infringement of civil liberties, our correspondent says.
He says that in the face of widespread civil disobedience, successive governments have always had a problem enforcing new legislation.
And so despite the tough talk, there is no guarantee that the new measures will succeed.
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