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The Lebanon, natural gas and local political equilibria

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As can be easily foreseen, the huge amount of natural gas that is being discovered throughout the East Mediterranean region is bound to quickly change the whole economic, strategic and military system of the Middle East.

As well as the links between the Greater Middle East and the European Union.

While, before the discoveries of the East Mediterranean region, the primary theme was the network of contacts between the EU West and the Arab-Islamic universe, currently these productive transformations change the internal relations among traditionally producing countries and place  Israel in a new economic context, thus making the EU countries enter this new maritime production system as full members.

Hence it is by no mere coincidence that the first East Mediterranean Gas Forum (EMGS) was organized in Cairo last January.

The Forum participants included Egypt, Italy, the European Union, Cyprus, Greece, Jordan and the Palestinian National Authority.

However, it also included Israel and this is certainly a fact not to be overlooked.

The logic of the meeting, however, is to create – in the short term – a politically and productively cohesive group, capable of maximizing the financial and political effects of this great operation and also avoiding competitive policies by other neighbouring gas areas.

First and foremost the Persian Gulf, but also the coastal areas of the Horn of Africa and the possible exploration areas off the Yemeni coast.

The Conference was sponsored by Schlumberger and Deloitte and hosted by World Oil, Gas Processing& LNG, Hydrocarbon Processing, Petroleum Economist, Pipeline & Gas Journal and, finally, by Underground Construction.

As can be easily imagined, also the large European and North American companies of the sector were present.

It should be noted that, this year, the Forum has also been slightly brought forward, for obvious reasons of strong political and productive needs.

Two countries, namely Syria and the Lebanon, did not participate and over the last few years they have started to exploit their offshore deposits in an autonomous way.

Obviously Syria will primarily support the Russian and Iranian networks towards Central Asia and China, while the Lebanon will use its offshore deposits, which are largely independent from neighboring countries, so as to revive its economy.

Zohr, the great Egyptian gas field, was discovered in 2015. In the future, however, Egypt also wants to become the hub for all the natural gas passages in the region, both to the EU and to the rest of the world.

The Israeli Leviathan and Karish gas fields have already started production, despite some tensions between the private technical and financial managers and the State of Israel, which wants a different use of a part of extractions.

If Israel’s gas transits through the Balkan line to Vienna, or through the Greek-Albanian network and Italy, it will anyway be fundamental for the European economy and its strategic equilibria.

In all likelihood, Israel’s gas will be even more decisive in the first operational version of the Southern Corridor – the one we have called “Viennese” – than in the Greek-Italian one.

As already mentioned, the Lebanon will mainly play the game against the Israeli gas, for both political and eminently economic reasons.

So far the Lebanon has indicated two Exploration and Production Agreements (EPAs) to a consortium led by Total, with the participation of ENI and Novatek, while Norway and the Lebanon are still collaborating for technical and legal issues through the oil for development program, which will last until 2020.

The Lebanon, however, has also completed its LNG import network for domestic electricity production, a primary problem for the country.

There are also several contracts expiring or to be renewed in the small, but very important market of Lebanese gas.

Political factionalism and the many overt and covert alliances of the Lebanon do not allow to have a homogeneous market of its natural gas.

With specific reference to Cyprus, ENI has discovered Block 6, with the wide Calypso deposit inside, while Exxon-Mobil still “drills” Block 10.

It should be recalled that Turkey has recently blocked the SAIPEM 12000 drillship just a few days after Block 3 was discovered. Turkey, however, has not behaved in the same way with Exxon-Mobil Block 10, in which it does not currently show any direct interest.

The problem is well known: Turkey believes that every exploration and processing-selling activity of all Cypriot gas should benefit both island’s communities and hence not only the Greek one.

The Cypriot government is dealing with Total for Block 11 and with ENI and Total for Block 6, but its real big problem is Aphrodite, the gas field  that should be connected to Egypt with a pipeline enabling Egypt to liquefy and transport gas to end markets.

Meanwhile Israel has already started production in 70% of its Leviathan fields, while the Karish and Tamimgas fields have been fully financed and are now operational.

Egypt’s Parliament has also voted for the creation of a new national natural gas Authority and already receives the LNG extracted by ENI in Zahr.

Hence currently the interests of the various gas producing countries tend to coincide and the Conference about which we are talking is very similar to the creation of what in the past – when economy still existed – was called “cartel”.

A cartel that depends, however, on the future distribution networks in Europe, as well as on the possible choice of some players to play the very “American-style” game of shale gas, and on the moves of the Russian Federation, which is entering this market in many regions. A cartel that finally also depends on the reactions of the Iran-Qatar axis and, hence, of the Saudi system that organizes the Emirates’ natural gas.

A very interesting fact was the request made by all participants to create an international gas organization in the region.

A new OPEC of natural gas?

Too early to say, but the idea is still in the minds of many Forum participants.

According to many Chinese analysts, this is highly probable.

It is worth recalling that currently the Forum countries already account for 87% of all the East Mediterranean’s natural gas.

Furthermore, the logic of opening to private investment and the “mutual benefit” criterion make this new gas OPEC a powerful attraction for all the new producing countries, which will not fail to join this network in the future.

Apart from geopolitical assessments and considerations which, however, are not currently clear yet.

Neither Israel nor Palestine can export their gas without passing through Egypt. Hence, in the coming years, the reasons for achieving a lasting peace will be much stronger than usual.

Unless, as someone predicts, we are faced with a very technological and utterly ubiquitous terrorism 2.0, which could take the form of the old Palestinian or “global” jihad or, possibly, of a mass anarchic-populist rebellion, but especially in the West.

Not to mention the new relationship between Palestine and Arab or Islamic countries, which would be changed radically by the new financial autonomy of the Palestinian world.

What are the challenges that the Forum countries must face to become stable producers in such an important and geopolitically sensitive market?

A market that tends to saturation, above all because of the structural economic crisis of Western markets.

Firstly, all deposits are in deep water and offshore, which makes extraction much more expensive than usual.

We are not talking about the cost of the North American shale gas, but we are not far off.

In the minds of many Middle East decision-makers, this linkage to the US and Canadian cost cycle can be very dangerous.

This could also force some competitors, outside the East Mediterranean region, to play the geopolitical and military card of the stable price increase, so as to temporarily taking the Eastern marine deposits off the market.

The geopolitical effects are hard to imagine.

Furthermore the infrastructure to put these huge resources on the market is extremely expensive and still very scarcely developed and will probably carry a very high and currently unpredictable geopolitical risk.

In fact, the standard geopolitical risks are well-known: the war in Syria; terrorism, which would certainly find a new area of action; the ambiguity of a vacuous and aimless Europe, which does not yet know what energy it wants to use in the future, undecided between the rhapsodic purchases of US shale gas and the strong tensions between France and Germany on the Nord Stream 2 gas pipeline, with the related recent agreement on the European Directive for gas pipelines (which regards Ukraine).

The Aachen agreement, although certainly being the basis of future links between France and Germany, clashes with the short and medium-term interests of two EU countries that have different energy networks, based on different geopolitics.

Moreover France and Germany are anyway thwarting the EU common energy policy, with the very recent stop of the South Transit East Pyrenees (STEP) between France and Spain.

It is well-known that Spain is currently the country with the highest re-gasification potential in Europe and France plans to fully exploit the already existing networks on its own.

The more energy prices are competitive at the EU edges, the fewer incentives exist for a common energy policy.

Moreover, on the basis of practical calculations, it can be inferred – with some degree of accuracy – that the political risk, combined with structurally high and not yet competitive extraction costs, has left 36% of East Mediterranean’s gas potential still unexplored and untapped.

However, the structure of the East Mediterranean Gas Forum, which is already based in Cairo, will be open to everybody including European countries, which could thus escape the grip of a “German-style” energy policy – the last and definitive phase of Southern Europe’s exclusion from the EU centres of power.

For the time being Turkey will not be part of the EMGF.

And it is by no mere coincidence that also the Lebanon will not be a member.

The reason is simple. There are very old tensions between Turkey and Cyprus but, as early as 2003, Turkey has denounced the agreements on maritime borders signed by Cyprus, considering that, according to Turkey, Cyprus – as EU Member State – cannot represent the two local communities, namely the Greek and the Turkish ones, and hence has no full international legal capacity.

Secondly, Turkey believes that Cyprus’ autonomy in defining its Special Economic Zones should be reduced significantly.

Moreover Turkey still thinks that also the current Cypriot Economic Zones are often in areas which are de facto in Turkish waters.

Hence, as early as 2008, Turkey has been rejecting all oil exploration activities in Cyprus and its disputed waters.

Furthermore Turkey intends to promote only its own exploration activities, always in the maritime area attributed to Cyprus.

Turkey’s relations with Greece are certainly not performing better. For years Erdogan has been claiming many Greek islands in the Aegean Sea. Not to mention the air crash, caused by an attack of Turkish fighters, which cost the life of a Greek pilot in April 2018.

As early as his visit to Greece in 2017, Erdogan has been constantly calling for the reform of the 1923 Treaty of Lausanne.

This refers to Turkey’s taking possession of the border areas with Greece that – according to the long-standing Turkish polemic in this regard -were “taken away” by Westerners to be given to Greece.

Erdogan strongly argues against Greece’s right of oil and gas extraction in certain sea areas, again on the border between the two countries, albeit  outside the Cypriot region, that he believes are part of a new finally legitimate border between Turkey and the Greek islands.

Turkey does not even agree on the current relations between Greece and Libya, given that Turkey repeatedly argues with Greece for its direct oil operations on the Libyan continental shelf, which it believes it can claim for a greater share.

However, there is also a further dispute between Turkey and Egypt.

Erdogan, in fact, has never fully accepted the coup of the Egyptian military services that in 2013 – in eleven days only -overthrew Mohammed Morsi and his Muslim Brotherhood’s government in Cairo.

Moreover, at the time, Erdogan -who has still many links with the Ikhwan – even asked the UN Security Council to impose specific sanctions on  Egypt and its internal operations against a government that certainly toppled Morsi’s democratically elected government, which anyway resulted from a great but obscure media, political and strategic operation, namely the Arab springs.

It is worth recalling that a deputy-director of CIA, Michael Morell, wrote in one of his memoirs, that the “Arab springs” were orchestrated and engineered by the Agency to foster popular uprisings “against Al Qaeda”.

The results of this crazy reasoning is before us to be seen. Erdogan, however, does not give up and often demands the release of all political prisoners held in Egyptian jails.

Yet the tension of this true mad card of the East Mediterranean region, namely Turkey, mounts even with Israel, which was once its best ally throughout the Middle East, when Turkey still was the heir of the old “secular” Republic of Atatűrk, with the young Turks who trained to seize power in the many Lodges of the Grand Orient of Italy scattered throughout the Ottoman Empire.

We can also recall the tension between Israel and Turkey during the Operation “Cast Lead” of 2008-2009 or the issue of the Marmara ships in 2010.

The situation between the two countries has never returned to normalcy, despite Israel’s apologies to Turkey, quickly organized by the United States in 2013 and the subsequent normalization of 2016, partly justified by the new energy scenario emerging in the East Mediterranean region.

Then there was the expulsion of the Israeli Ambassador from Ankara in 2018and Erdogan accusing Israel of “genocide”. Finally the choice, which Turkey considers strongly prompted and desired by Israel, to move the US Embassy to Jerusalem.

Hence, on the one hand, the East Mediterranean’s oil and gas extraction requires a very high degree of collaboration between all the parties involved, while, on the other, it is the exactly the new Eastern wealth to create new rifts and fuel old tensions.

In fact the perception of an “aggressive” Turkish behavior is currently extremely widespread among all the participants in the Cairo Forum (but obviously not in Italy).

This tension, however, also affects the Lebanon, where many leaders still believe that the Forum is primarily targeted against their country.

In short, especially with this new and recent government led by Saad Hariri, the Lebanon believes it can manage, on its own, to effectively extract and monetize its maritime gas resources.

In fact, some Ministers of this Hariri-Hezbollah’s government maintain that the Lebanon could be connected to Europe through Northern Turkey (and this is another temptation for Turkey) via the Arab Gas Pipeline, although obviously, the expansion of this network with the pipeline in Syria is to be completed yet.

However, there would also be the line through Egypt, again using the Arab Gas Pipeline.

In short, the Lebanon thinks it has been thrown out, but it will soon realize that there is the possibility – also and especially with a Forum in which there is also Israel – to use at best and, above all, soon the distribution systems put in place by the Forum.

Advisory Board Co-chair Honoris Causa Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr. Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “International World Group”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title “Honorable” of the Académie des Sciences de l’Institut de France. “

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The African oil markets of China and the continuous daily needs for crude oil

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In an attempt to position themselves as international players in the global oil and gas market, China’s national oil companies are investing heavily in the exploration and production of oil and gas supplies in Africa. Africa is the second largest region in supplying oil and gas to China, after the Middle East, with over 25% of its total imported oil and gas.

There are three key players committing an almost equal share of the planned 15 billion US dollar spending to the development and production of the African oil sector: China National Petroleum Corporation (CNPC), China Petroleum & Chemical Corporation (SINOPEC) and China National Offshore Oil (CNOOC).

The joint investment is expected to be the fourth largest one in the 2019-2023 period, after BP Plc, Royal Dutch Shell Plc and ENI SpA. This investment in African oil and gas is larger than the 10 billion dollars that the People’s Republic of China is investing in South America and is more than double the estimated investment in North America. Coa Chai, an expert at GlobalData, said: “About two thirds of spending is in Nigeria, Angola, Uganda and Mozambique. SINOPEC and CNOOC are well-established in Nigeria and Angola, while CNPC has a stake in the Rovuma LNG project in Mozambique”. He also added: “The increase in domestic energy demand has led China to diversify its imports of natural resources and China’s presence has increased significantly in almost 20 African countries”. One of China’s largest trading partners is the largest African oil producer, namely Nigeria. Nigeria currently pumps two million oil barrels a day and aims at producing three million barrels a day by the end of 2023. As China’s domestic oil production keeps on declining, experts predict that up to 80% of crude oil will be imported over the next 15 years.

There have been several remarkable investments by CNOOC, including the acquisition of a majority shareholding in an oil and gas exploration project by the Australian company FAR Ltd. The latter is drilling oil off the coast of Guinea-Bissau (West Africa). A FAR Ltd. spokesman said that CNOOC would obtain a 55.6% stake in the Sinapa and Esperança licenses of Swedish Svenska Petroleum Exploration AB. The Chinese oil producer may choose to become the operator of the joint venture after the completion of an upcoming offshore drilling campaign. CNOOC’s interest will be converted into a 50% share in case of successful discoveries. In Nigeria, CNOOC’s investment and involvement dates back to 2005 and the company is now the largest Chinese investment entity in Nigeria.

In 2006, CNOOC spent 2.3 billion dollars to acquire a 45% stake in the deepwater license of the Nigerian company OML 130, which is located in one of the most prolific oil and gas fields on the planet and contains the deposits of Akpo (discovered in 2000) and Aegina (discovered in 2003).

The Nigerian National Petroleum Corporation (NNPC) has made public its support for Chinese investment in Nigeria, despite the fact that the region has had considerable problems with the populations involved. These problems include sporadic outbreaks of violence: some young people have taken actions, including theft, as a way to demand access to the country’s oil wealth. There has also been a questionable lack of transparency by NNPC, which apparently has not been able to demonstrate its billion dollar revenues in recent years.

While trying to meet the growing domestic demand for fuel, Aliko Dangote (No. 1957) – the richest African and Nigerian business tycoon – is building what will be Africa’s largest oil refinery in the former capital Lagos. The nine billion dollar megaproject is supposed to be completed by the end of 2020, thus doubling Nigeria’s refining capacity and potentially turning the country into an exporter of refined products.

As China’s largest oil and gas producer in terms of efficiency and power developed, CNPC has recently signed a contract with the government of Benin (West Africa) to build and operate a crude oil pipeline in the region. It will extend for 1,980 kilometres from the Agadem oil field in Niger to the Seme Terminal port in Benin. It is the largest investment in a transnational pipeline that CNPC has ever made in Africa and aims at further allowing the transport of crude oil from Niger to international markets, as well as promoting social and economic development in Benin. Besides these large companies that invest heavily in the oil and gas industry, China is also contributing to the growth of African infrastructure as a way to have great economic and social impact. A noteworthy entrepreneur is Wilson Wu, an electrical engineer, who now manages the free trade zone of the Ogun State, Nigeria: a public-private project in which the local government provides the land and Chinese companies the capital. Wu is said to be one of about one million Chinese citizens who have ventured into Africa over the last twenty years to seek their fortune.

The daily need for black gold

It should be noted that the People’s Republic of China has increased its oil share by 20% so as to take advantage of low oil prices. Indeed, according to an announcement by the Chinese Ministry of Commerce, in a situation of declining demand and signs of increasing supply, the world’s largest oil buyer has increased the share for the use of crude oil abroad by non-State entities for 2021 by over 20% compared to 2020.

The increase in the import quota is equal to about 823,000 barrels per day, which is slightly lower than the amount pumped by Algeria that is an OPEC member. The companies that will use oil include privately-owned refineries, known as “teapots”, which in recent years have become increasingly important in the global oil market. These companies have been operating their facilities at a higher utilization rate than in 2019 for many months now, while their counterparts in the United States and Europe are lagging behind.

The increase shows that China’s oil purchases will be even larger at a time when global demand is facing new headwinds coming from further restrictions and blockages, while Covid-19 infections are spreading again in Europe and the United States.

Deteriorating demand prospects, together with a new supply in Libya, have weighed on reference prices, thus bringing West Texas Intermediate down to 6% on October 26, 2020. At 7:29 a.m. New York local time, the crude oil price was 2.4% lower, at $34.93 per barrel.

Behind the import push there is the ambitious expansion of China’s capacity. The country’s brand new mega-refinery, Zhejiang Petrochemical, started up one of its new 200,000 barrel/day crude oil distillation units on November 1. Another independent Chinese refinery, the Shenghong Petrochemical Group, is working on the construction of the country’s largest crude oil unit, which is expected to start up by the end of 2021.

Oil traders have been buying cargoes since the beginning of October 2020 and sending them to China, hoping to capitalize on an expected increase in demand at the end of the year when the independent refineries obtain the import licenses for 2021.

According to the Ministry statement, China has set the import quotas of crude oil for non-State companies at 243 million tons. According to the data collected by Bloomberg, this is equivalent to 4.9 million barrels per day. China has kept its annual quota unchanged at 202 million tons for this year, after an extraordinary increase of over one million oil barrels per day for 2019 compared to the previous year.

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Nord Stream 2: Who Benefits From the Navalny Affair?

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On October 7, the French Foreign Minister Jean-Yves Le Drian and his German counterpart Heiko Maas issued a joint statement condemning the “Russian involvement and responsibility” in the Novichok poisoning of Alexey Navalny. In retaliation for the violation of the Chemical Weapons Convention, France and Germany will share several proposals for sanctions with their European partners.

This statement occurs in the complex and unstable context of the Russian-European project, Nord Stream 2. Undermined by threats of U.S. sanctions, this infrastructure venture, surely the most ambitious in Europe, is currently at a standstill.

In Germany, various political figures are voicing their willingness to abandon the project, such as Norbert Röttgen, chairman of the Foreign Affairs Committee of the Bundestag and presidential candidate of the CDU. Another candidate, Friederich Merz, offered to immediately suspend the work for two years in reaction to Navalny’s poisoning. Despite these pressures, Angela Merkel can still rely on other supporters, such as the former chancellor, and chairman of the supervisory board of Nord Stream, Gerhard Schröder, or Nils Schmid, the vice-chairman of the SPD group in the Bundestag. As the German Chancellor begins her final year in office, the future of the project has never been so uncertain.

What is Nord Stream 2?

Nord Stream is a setup of gas pipelines that would allow Germany to be supplied with Russian natural gas via the Baltic Sea. The first two pipelines were inaugurated in 2011 and are known under the name “Nord Stream 1.”

The Nord Stream 2 project for the construction of two other pipelines was launched in 2018 to double the quantity supplied by Nord Stream 1.

While benefitting from the unmitigated support of Moscow, Nord Stream 2 is a truly European project, driven by 4 countries: Russia (through Gazprom — 51% shares), Germany, (through Wintershall and PEG Infrastruktur — 15.5% each), and France and the Netherlands (9% each, via Engie and Gasunie). In addition, more than 100 companies from 12 European countries are involved in the construction of Nord Stream 2.

The pipeline is a response to Germany’s increasing demand for natural gas. The German energetic transition policy aims to reduce coal-burning and close nuclear reactors by 2022. Natural gas is necessary to achieve this transition and could become, according to an article from Reuters, the second pillar of the power supply after renewables.

Nord Stream 2 would allow Russia to transport gas in unmatched quantities to Europe. This competitive advantage, along with the low price of Russian gas, resulted in the United States’ strict opposition to the project. Indeed, since the advent of technical innovations allowing the extraction of shale gas and its export as liquefied natural gas (LNG), the USA has become one of the leading gas suppliers in the world. However, the cost of producing American gas is much higher than that of Russian gas. It is therefore easy to understand the American hostility towards the project. On December 21 2019, while Nord Stream 2 was 94% complete, the threat of an American antitrust law to sanction companies involved in the construction of the pipeline led Allseas, a Swiss company, to halt its work. In order to resume work, the consortium has to find another contractor, but other firms fear finding themselves under U.S. sanctions.

American pressure is greatly felt in Europe. Last August, a group of U.S. Republican senators vowed to impose “crushing legal and economic sanctions” on the Port of Sassnitz in Germany. The USA also slowed down the project by putting pressure on the countries concerned by the route, such as Denmark, which was the last one to issue authorization for the pipeline to cross its territorial waters. As one of the major U.S. allies in Europe, Poland’s antitrust watchdog slapped a record $7.6 billion fine on Gazprom, which represents 10% of the Russian company’s revenue. Mateusz Morawiecki, the Polish Prime Minister, also called on Germany to halt the Nord Stream 2 project, depicting it as a threat to the stability of Europe.

It is certain that the creation of the pipeline, by stimulating competition, would allow a more reasonable price on the European gas market. Critics of the project fear a dependence of European countries on Russian gas. This argument can easily be questioned. Indeed, Nord Stream 2 in no way prevents other suppliers such as Algeria, Norway, the USA or the Netherlands from supplying gas to European countries to diversify their supply. The central issue is that of a lower price, which, as in all markets, worries suppliers.

Opposition to Nord Stream 2 is not motivated by market share concerns only, as global energy supply flows have an inherent geopolitical dimension. The position of Ukraine epitomizes this intertwining of economic, energy security, and geopolitical aspects. Indeed, Nord Stream 2 would also allow Russia to bypass Ukraine, located on the main current route for European imports of Russian gas—and to deprive it of 2 billion dollars annually, roughly 3% of the country’s GDP. Because of its key strategic position, in the long term, it is in the interest of all countries to maintain a cordial relationship with the latter. This is why the question of its loss of income must be addressed, respected and treated seriously, both by Russia and by its Western partners.

Navalny Poisoning: a Tool in Information Warfare

The objective of this article is not to lift the veil on the unfortunate poisoning of Alexey Navalny but to understand how this affair is treated by the mass media and what impact it has on the Nord Stream 2 project.

On August 20, Alexei Navalny fell ill on a flight between Siberia and Moscow and was placed in a coma for two weeks. Initially hospitalized in Omsk, he was transferred to Germany on August 22, where, following blood work, the Novichok nerve agent was found in his system.

Although the outcome of the Navalny case remains unknown, it is already fueling pro-Western and pro-Russian arguments. First of all, by the communication of Mr Navalny himself, who, via social networks like Twitter or Instagram, accuses the Kremlin of his poisoning.

In the overwhelming majority of Western media who use him as a figure to denounce the Russian system, Alexey Navalny is presented as the primary opponent of Vladimir Putin. The first analysis of the case published by Le Monde (one of the most popular French newspapers) states, “there is a simple truth: political violence is inherent to the Putin system.”

This thesis, depicting Russian power assassinating its opponents, comes from an old narrative framework and reminds us of a collective subconscious very present in Western minds. There are many examples, for example the Skripal Affair recently, but also in Russian history, such as the elimination of Paul I by Catherine II, the sponsored assassination of Trotsky, Alexander I, etc. It is essential to take into account this common bias moulded by the Cold War when analyzing Western media criticism of Russian power.

In the context described previously, the choice of Navalny’s relatives to transport him outside of Russia, to Germany, on purpose or not, necessarily gives a geopolitical and international dimension to his poisoning.

The outcome of this assassination attempt is, at present, murky and difficult to anticipate. Nevertheless, the criticism, analysis and denunciation of the presumed role of the Russian government in the poisoning have made it possible to question the place of Russia in the system of international relations.

The American newspaper Politico clearly highlights the dynamics in Western mass media. In an article dated September 16, Polish Minister of European Affairs Konrad Szymański took a stance on Nord Stream 2. The article headlined, “Navalny poisoning shows why Putin’s pipeline must be stopped.” As the article goes on, he denounces the Russian-European project, criticizes German energy consumption and defines the poisoning of Navalny as a “rude awakening” of the danger that Europe runs when dealing with Russia.

Several major European newspapers have used similar arguments, such as The Guardian, Le Figaro, Corriere della Sera or Deutsche Welle. Alexei Navalny is, well beyond his control, a communication tool in the information warfare. His case is instrumentalized and allows different stakeholders to assert their interests.

Nord Stream 2: Revealing Interests and Influences

In this geopolitical chessboard based on communication, some countries have obvious interests. This is the case for the United States, Poland, the Baltic States and Ukraine. On the other hand, Austria’s President Alexander Van der Bellen supports the project. After talks with Ukrainian President Volodymyr Zelensky, he declared, “In this particular case, we are talking about diversifying gas supplies. This is a commercial issue.”

Most of the other stakeholders have more ambivalent positions. France, which contributes to the project through the company Engie (whose state has 23.6% of the shares) has a clear economic interest in the realization of the project. However, the country—in a declared approach of rapprochement with Russia since the election of President Macron—is also subject to American influence through its bilateral relations and structures such as NATO.

The American influence is even more visible on Denmark, despite the denial of the Danish government on the interference of foreign powers. The country first authorized the construction of the gas pipeline in its territorial waters on October 30, 2019, a few months after the election of Prime Minister Mette Frederiksen. More recently, in an interview with Danish agency Ritzau, the latter declared, “I’ve been against Nord Stream 2 from the start” and “I don’t think we should make ourselves dependent on Russian gas.”

We can also remember that in July 2020, Mike Pompeo, American Secretary of State, visited Denmark. During this visit, he publicly praised the country’s energy policy.

What About the Future?

Angela Merkel has on several occasions insisted on the absence of a link between the poisoning of Navalny and the construction of Nord Stream 2. While the project has stalled since last year, this speech shows the vital interest of Germany for privileged access to Russian gas. Germany’s energy transition depends on it. However, as we have seen, Europe is fundamentally divided on this project. As a true driving force of the European Union, Germany must condemn the poisoning of Navalny, treated in a German hospital, in order to consolidate its leadership.

France, the other great leader of the European Union, is following it in this process. This is why the joint statement of the two foreign ministers, Mr Le Drian and Mr Maas, presented in the introduction underlined the following concerning sanctions: “Proposals will target individuals deemed responsible for this crime and breach of international norms, based on their official function, as well as an entity involved in the Novichok program.” The absence of any mention of the Nord Stream project, while it is at the very centre of current geopolitical tensions, shows the strong will of the two countries to carry out the project.

Completion of the pipeline, which has already cost Russian and European partners more than 9.5 billion Euros, will greatly depend on the treatment of information in key countries, with Germany at the forefront. Time is playing for the United States while Angela Merkel, still faithful to the project, will be replaced within a few months. If the project is not completed or abandoned before the next German election, we can be sure that Nord Stream 2 will occupy a prominent place in the debates.

From our partner RIAC

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Energy Research Platform Takes Central Stage under Russia’s BRICS Chairmanship

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After the Ufa declaration in 2015, BRICS, an association of five major emerging economies that includes Brazil, Russia, India, China and South Africa, has made energy cooperation one of its priorities besides attaining an admirable significant influence on regional affairs and very active on the global stage.

That 7th summit held in July in the Russian provincial city of Ufa in Bashkortostan, under Russia’s initiative the BRICS adopted the key guideline for expanding among many other spheres, development of energy cooperation, bridging the scientific and technological gap, as well as finding solutions to the challenges in the energy sector among the members.

The Ufa Declaration (point 69) states “Recognizing the importance of monitoring global trends in the energy sector, including making forecasts regarding energy consumption, providing recommendations for the development of energy markets in order to ensure energy security and economic development, we call on our relevant agencies to consider the possibilities of energy cooperation within BRICS.”

“Taking into consideration the role of the energy sector in ensuring the sustainable economic development of the BRICS countries, we welcome balancing the interests of consumers, producers and transit countries of energy resources, creating the conditions for sustainable and predictable development of the energy markets,” it further stated.

Worth to remind here that it was Russia’s proposal to hold the first meeting of the BRICS Ministers of Energy during the fourth quarter of 2015. While reaffirming the importance and necessity of advancing international cooperation in the field of energy saving, energy efficiency and developing energy efficient technologies, the BRICS look forward to developing intra-BRICS cooperation in this area, as well as the establishment of the relevant platform.

In 2020, Russia holds the rotating chair of BRICS. BRICS has neither a secretariat nor a charter. The country that chairs BRICS organizes the group’s summit and coordinates its current activities. Russia has been holding series of conferences focusing on different directions. In mid-October, the BRICS Energy Ministers held their meeting and approved a roadmap for cooperation in energy sphere that runs until 2025.  Due to coronavirus pandemic, it was video conference chaired by Russian Energy Minister Alexander Novak.

The influence of BRICS nations on the international arena is increasing due to the increasing economic power of the participating states, and it is imperative for them to coordinate their positions in energy cooperation, Minister Novak said during the meeting.

“Today, the BRICS nations represent nearly one fourth of global GDP and over a third of global consumption and production of energy. In this regard, it is very important to coordinate the positions of our nations where we have common interests and speak from a unified position in global platforms which concern themselves with matters of international energy cooperation,” he said.

“We have already begun to implement this idea in practice. Our nations have launched informal consultations on the sidelines of the G20 and on the sidelines of the World Energy Council. Beginning our work this year, we have collectively determined three key vectors of the energy dialogue. These are the support for the development of the national energy systems of BRICS nations, technological cooperation and facilitation of improved terms for investment in energy, contributing to the stability of energy markets and increasing the role of BRICS in the global energy dialogue,” Novak emphasized.

The roadmap adopted at the end of the meeting is the first comprehensive document that sets out agreed plans for the development of the energy dialogue between the five countries. The meeting also issued a communique confirming the intention to strengthen their strategic partnership in the energy sector and the area of energy security, and noting the important role of all types of energy, including fossil fuels and nuclear power.

The ministers affirmed that energy transition should correspond to national conditions and each country should determine the optimal policy without being compelled to adopt models that do not fit BRICS countries, according to the Russian ministry statement.

On October 15, Moscow hosted the first Annual Meeting of the BRICS Energy Research Platform, where analytical reports by the BRICS countries presented. That was followed by the largest youth energy event in BRICS. This year, delegations from all five countries comprised of representatives of Line Agencies responsible for the implementation of energy and youth policies as well as over 150 young scientists and experts from 40 leading universities and industrial organizations took part in the summit.

According to surveys conducted by the VTsIOM, Russian public opinion research centre, the number of families that have been taught to save energy has doubled over the past five years. That the BRICS countries are taking part in the #TogetherBrighter International Energy Saving Festival, as part of the BRICS Energy Week (October 16 – 20) was a landmark event of Russia’s BRICS Chairmanship.

Notably, the Energy Research Platform designed to encourage the research community’s involvement in the practical activities on drawing up energy resource plans. Two major events took place as part of the Energy Research Platform. The results submitted for consideration by the heads of state for effective industrial interaction and practical cooperation in developing and implementing new joint energy.

Based on national statistics and forecasts, leading BRICS experts have prepared the “BRICS Energy Report” – a review of the energy sectors in the five countries, and the “BRICS Energy Technology Report” – focuses on the priorities of technological development of the fuel and energy sectors in BRICS. The reports came from leading experts, representatives of major research institutes and energy companies from the BRICS countries as well as international energy organizations, such as OPEC, GECF, the World Energy Forum, the Clean Energy Ministerial and the World Energy Council.

In September, Foreign Minister Sergey Lavrov held an online meeting of the BRICS Foreign Ministers Council in Moscow. That was second of such meetings this year under Russia’s chairmanship. The first one was dedicated exclusively to mobilizing efforts to prevent the spread of the coronavirus infection.

Within an updated Strategy for BRICS Economic Partnership to 2025, Russia has drawn proposals on developing a new mechanism for the five member’s interaction in securing sustainable economic development in the post-pandemic age.

The theme of the Meeting of the Leaders of BRICS countries is “BRICS Partnership for Global Stability, Shared Security and Innovative Growth” which is planned for November 17 via videoconference, to be coordinated and moderated in Moscow. This year the five countries have continued close strategic partnership on all the three major pillars: peace and security, economy and finance, cultural and people-to-people exchanges. 

“Despite the current global situation due to the spread of the coronavirus infection, the activities under the Russian BRICS Chairmanship in 2020 are carried out in a consistent manner. Since January 2020, more than 60 events have been organized, including via videoconferencing. The BRICS Summit will provide impetus for further strengthening cooperation together with our partners and ensure well-being of BRICS countries,” – noted Anton Kobyakov, Adviser to the President of the Russian Federation, Executive Secretary of the Organizing Committee to Prepare and Support Russia’s SCO Presidency in 2019 – 2020 and BRICS Chairmanship in 2020.

Since 2009, the BRICS nations have met annually at formal summits, with Brazil having hosted the most recent 11th BRICS Summit in November 2019. Russia is pushing forward significant issues of five-sided cooperation in the bloc’s three areas of strategic partnership: policy and security, economy and finance, and cultural and educational cooperation. The five BRICS countries together represent over 3.1 billion people, or about 41 percent of the world population.

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