EU seeks to enroll Caucasus neighbors, Egypt and Iraq into energy deal bypassing Russia

BRUSSELS (AP) — The European Union will press eight southern neighbors on Friday to join a long-term partnership that would give them a sustained income from their natural gas in the years ahead and provide Western Europe with stable gas deliveries that bypass Russia.

At a meeting in Prague with leaders of Azerbaijan, Georgia, Turkey, Turkmenistan, Uzbekistan, Kazakhstan, Egypt and Iraq, the EU will push for a broad commitment on the expansion of a web of half a dozen east-west gas pipelines spanning thousands of miles (kilometers).

The United States, Russia and Ukraine will attend the event as observers.

Last winter's cutoff of Russian gas to Western Europe, the result of a Russia-Ukraine gas trade dispute, has dented Moscow's reputation as a supplier and made the EU wary of Russia's South Stream pipeline project. South Stream is to carry Russian and possibly Central Asian gas to Bulgaria and deeper into the EU.

The draft of a declaration to be issued after Friday's meeting calls linking the energy-starved EU to gas-rich nations on the Caspian Sea and beyond "a mutually beneficial initiative."


The link would create "a modern Silk Road" to Asia and common prosperity, stability and security of all countries involved, says the text obtained by The Associated Press.

It gives an ambitious outline of how a Southern Corridor of pipelines — some of which exist already — would be extended, connected or upgraded.

The draft asks governments to commit to long-term and commercially profitable construction deals, to let both private and public companies bid for projects and to resolve quickly current disputes that are delaying construction projects.

European Commission President Jose Manuel Barroso said Thursday that cooperation will benefit all concerned, and that by opening their reserves to more exploration, Caucasus nations are bound to see an economic boom.

European nations and companies have for years been weighing half a dozen pipeline projects, including one that would cross Russia — an option not favored by EU headquarters.

"If we in Europe do not get these supplies of gas (from the Caucasus), then they will end up in Russia or China. We must not doubt that," an EU diplomat said before the Prague talks.

The official asked not to be named, given the sensitive nature of the issues, notably Russia's role.

Growth in European demand for gas is set to grow steadily — from 580 billion cubic meters (759 billion cubic yards) in 2007 to 750 billion cubic meters (981 billion cubic yards) by 2030 — while production within the EU will fall to 205 billion cubic meters (268 billion cubic yards).

The EU counts on countries around the Caspian Sea, notably Azerbaijan and Turkmenistan, to provide the 27-nation bloc with about 40 billion cubic meters (52.32 billion cubic yards) of natural gas per year.

The EU bloc has tenuous relations with Moscow, highlighted by January's cutoff of gas to Western Europe.

While Russia is bound to remain a key supplier — today 40 percent of EU gas imports come from Russia — the EU wants its imports to be more diversified.

It backs three gas projects, all bypassing Russia. It prefers the euro10 billion Nabucco project, which by 2013 is to link the Caspian Sea region, Middle East and Egypt to the EU via Turkey. The others are the Inter-Connector pipeline linking Turkey to Italy via Greece, and the White Stream, which would run from Georgia to Romania across the Black Sea.

Nabucco faces problems, however. Ankara is at odds with Azerbaijan over the cost of sending Azeri gas across Turkey by pipeline.

That pricing dispute is delaying the Nabucco project and may push Azerbaijan into a deal with Russia. Moscow's proposed South Stream project — Nabucco's biggest rival — has already drawn participation pledges from Italy and Bulgaria.
LAT

Evil blood sucking Europeans.