Gas crisis focuses minds on new routes
Published: 09 January, 2009, 22:08
Edited: 14 January, 2010, 22:27
As Europe waits for gas supplies to resume, support is growing among leaders to find alternative transit routes. Gazprom says it’s ready to accelerate the construction of proposed Nord and South Stream pipelines.










It is not accurate that the problems of transit accross Ukraine are giving momentum to Nabucco project. Just the opposite is true. It has given momentum to Nord Stream and South Stream. The reason is simple. Both these projected pipelines are sourced with gas, as Russia has by far more reserves, while current demand slows. The problems with transit over Ukraine was political, and political capital has been attempted to be raised from that event to bolster Nabucco. Granted, all the positive noises were made at the time, but Nabucco does not have the sources of gas. The speculation over Turkmenistan has pewtered out, as it became clear that Turkmenistan intends to honor agreement with Russia through 2028, and the new reserves have been committed to giant Turkmenistan-Uzbekistan-Kazahstan-China pipeline. The pipeline, that has just been commissioned, speaks for itself. Additional branch has been opened to Iran. And to insure that Turkmenistan can meet its obligations, the existing fields within country will be networked, curtesy of Russa's financing. This will insure that various fields can supply China, Russia or Iran, as they can reroute the gas as needed. South Stream will get one of its branches from Greece to Italy, and will likely be done sooner. Bulgaria will become by far less important in this schema, and the longer the "rethinking" lasts, the less valuable the country will be. After all, the northern branch to Serbia and Hungary can come accross Macedonia. South Stream, even if only Turkey-Greece-Italy trunk is built, brings gas to Europe. The only hope for Nabucco is Iran's gas. And for that, a major accommodation of Iran will have to be found. Othewise, the Turkmenistan-Iran trunk can also work in the reverse, go from Iran to Turkmenistan, and from there supply vast Asian market. Gas needs will rise, as many countries convert from oil to gas. This is just a matter of time.