Tuesday, January 27, 2009

Gas: Nabucco Pipeline gains favour

In 2007, the Hungarian Prime Minister Ferenc Gyurcsány ruffled feathers in Brussels by signing up for a new Russian gas pipeline project called South Stream during a visit to Russia in February of that year. Eurocrats were riled because Gyurcsány described the EU's own pipeline project, Nabucco, as a dream. "You cannot heat homes with dreams," he said, quoted by the Budapest Times.

Now, as the region counts the economic and political cost of the recent Russia-Ukraine gas crisis, Gyurcsány is among those most vocally championing the Nabucco pipeline. This week Hungary hosts an international Nabucco summit, to which Azerbaijani President Ilham Aliyev, Bulgarian Prime Minister Sergei Stanishev and the heads of the EBRD and the European Investment Bank have all accepted invitations.

The European Union receives a quarter of its natural gas from Russia, and 80 per cent of that is piped through Ukraine. As a relic of the Cold War era, most of the Russian gas imported to the EU is used by the new member states of Central Europe. Hungary receives about three quarters of its gas either directly or indirectly from Russia. Other countries, such as Slovakia, Bulgaria and Serbia, are almost entirely dependent on Russian gas, and were in a state of emergency earlier this month. However, the effects of the shut down of supplies last week were even felt to some extent in France and Germany.

Source: FOCUS Information Agency
Published by Mike Hitchen, Mike Hitchen Consulting
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