EU Commission worried about Ukraine gas supply

"We are not concerned about short-term security of supply," Energy Commissioner Oettinger told a news conference. "But we are concerned about security of supply in Ukraine."

EU Commission worried about Ukraine gas supply

World Bulletin/News Desk

European Union policymakers are concerned about the risk of gas shortages in Ukraine, but there is no immediate threat to supplies in Europe, where stocks are high after a mild winter, Energy Commissioner Guenther Oettinger said on Tuesday.

Ukraine has strategic importance as a major gas transit nation for supplies from Russia to the European Union, which relies on Russia for about a quarter of its gas.

EU energy ministers meeting in Brussels on Tuesday held talks on the energy consequences of turmoil in Ukraine.

The discussion is expected to continue as part of wider debate on the crisis at an emergency meeting of EU leaders on Thursday.

"We are not concerned about short-term security of supply," Oettinger told a news conference. "But we are concerned about security of supply in Ukraine."

"We feel that Ukraine should stay as a single market. If Ukraine splits up, this is going to be a disadvantage for the market," he said.

President Vladimir Putin denied that Russian troops had seized Ukraine's southern Crimea region, where armed men, with no insignia but bearing all the marks of their Russian origins, have taken control of all official buildings and some army bases.

At the same time, Russia's gas export giant Gazprom has said it will remove a discount on the price it charges Ukraine for gas from April.

That increases the risk that Ukraine, which says it needs $35 billion over the next two years to stave off bankruptcy, will not be able to pay its gas bill.

The European Union is in talks with international financial institutions on financial help for Ukraine and Oettinger reiterated on Tuesday that the aid could cover gas, including co-financing a modernisation of the gas system.

Oettinger also said he would meet Ukraine's newly appointed Energy Minister Yuri Prodan in Brussels on March 19, a day before a scheduled meeting of EU leaders.

Following previous gas supply crises involving price disputes with Ukraine, the EU has increased requirements for member states to hold storage, it has improved infrastructure and it has sought to diversify supply.

Some EU ministers on Tuesday said the Ukraine situation underlined more than ever the need for Europe to develop its own energy in the form of renewable sources and possibly shale gas.

EU diplomats, speaking on condition of anonymity, said Tuesday's discussions also raised concerns about the cost implications of the Ukraine crisis, which could stoke gas prices and potentially increase the need for liquefied natural gas.

Bulgaria weighs dependence on Ukraine route for Russian energy

Bulgaria, heavily dependant on Russia for gas and oil, will estimate its own reserves and seek alternatives to cope with any worsening of the Ukrainian crisis, it said on Tuesday.

Bulgaria imports over 70 percent of its energy resources, most of which come from Russia - through Ukraine - and is considering alternatives for its energy security

"Several key threats can be outlined that can pose risks to Bulgarian security. They are mainly economic," Deputy Prime Minister Tsvetin Yovchev said after a meeting of the government's security council over Ukraine.

It meets over 85 percent of its gas needs with imports from Russia's Gazprom through only one route that passes Ukraine.

Its only oil refinery, run by Russia's LUKOIL, that supplies over 60 percent of the its refined fuel in the country, gets its crude through an Ukrainian Black Sea port.

The fresh nuclear fuel for the Kozloduy nuclear power plant that produces about 40 percent of Bulgaria's electricity is also shipped through Ukrainian territory.

Bulgaria has pledged to build new gas links to provide alternative gas supplies and routes, but has not yet linked its gas network with neighbouring Romania, Greece and Turkey.

In case of emergency, Bulgaria can rely on its gas storage facility, which has reserves for about two months, the energy ministry said, and it may also use a transit pipeline to Greece to reverse flows and get natural gas from there.

The government may still be forced to limit gas consumption to industry as the gas that can be pumped up from the storage facility is up to 4.2 million cubic metres (mcm) per day, compared to country's average daily consumption of about 8 mcm per day.

Bulgaria has nuclear fuel for about two and a half years, which limits the risk for the operations of the 2,000 megawatt Kozloduy nuclear plant, the energy ministry has said.

Last Mod: 05 Mart 2014, 11:13
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