Poland's Tusk seen leading call for land gas route
05 Feb 2008 18:42:48 GMT Source: Reuters
By Tanya Mosolova MOSCOW, Feb 5 (Reuters) - Poland hopes to convince Russia to abandon the Nord Stream gas pipeline under the Baltic Sea and back an alternative land route across its soil when their leaders meet this week, a Polish diplomat said on Tuesday. The concept may be discussed at Friday talks between newly-installed Polish Prime Minister Donald Tusk and Russian President Vladimir Putin, although the final agenda has yet to be confirmed, Polish diplomat Jerzy Rutkowski told Reuters. "The land pipeline may cost about $3 billion. So why pay $12 billion if you can pay four times less?" said Rutkowski, the secretary for economic issues at the Polish embassy in Moscow. The Baltic States and Poland, a major transit route for Russian gas, fear the direct seabed link from Russia to Germany would allow them to be cut off easily from Russian supplies. Sweden and Finland have worries about the environmental impact of the pipeline on the sea floor. Russia already supplies one quarter of Europe's gas and wants to boost its share further. Poland is leading a bid to revive the idea of the Amber pipeline to carry gas from Russia via Estonia, Latvia and Lithuania to Poland and Germany. The Amber route, as well as a Polish idea to build a second line along the existing Yamal-Europe pipeline from Russia to Poland via Belarus, has been rejected by Russia's gas export monopoly Gazprom <GAZP.MM>, which already supplies one quarter of Europe's gas and wants to boost its share further. Gazprom's supporters say Amber's advocates are chiefly interested in demanding transit fees. But Nord Stream, majority owned by Gazprom with Germany's BASF <BASF.DE> and E.ON <EONG.DE> as well as Dutch firm Gasunie as shareholders, may be expensive at up to $12 billion. It is also already running behind schedule, as permission to run under international waters is sought. Poland will stress that, unlike Yamal-Europe 2, the Amber route would bypass Belarus and Ukraine, reducing risks of pricing disputes disrupting transit supplies to Europe."(There are) no political risks at all, the pipeline would run across the territories of Russia and European Union countries, which will definitely stick to transit agreements," Rutkowski said. Latvian President Valdis Zatlers told Reuters on Tuesday his country would back the Amber scheme if Russia, Germany and Poland agreed on it first. "It is better to talk about Nord Stream's alternatives, like the Amber project. It has the same economic efficiency, but from the point of view of security and the environment it is much better," he said [ID:nL05151250]. NORD STREAM CONFIDENT Nord Stream is expected to start shipments along the 1,200 km (750 mile) route in 2011. It plans initially to pump 27.5 billion cubic metres a year, doubling capacity with a second line in 2012. The group said it believed it would be more profitable than alternatives in the long-term. "It may be more expensive to build under-sea pipelines, but their overall costs prove to be 15 percent lower over 25 years than those of an onshore pipeline," Irina Vasilyeva, the Nord Stream spokeswoman, told Reuters on Tuesday. She said offshore pipelines pose lower environmental risks as they are far from human activity. Finally, Europe will need more gas long-term, leaving room for yet other routes, she said. "It is clear now that all of Nord Stream's gas will be in demand. A significant share has been already pre-sold. European market dynamics show other routes will be needed as well," she said. Viktor Baranov, president of the Russian union of independent gas producers, said he believed Nord Stream would be built first as Germany, Europe's largest economy, had already committed to buy the bulk of Nord Stream throughput. Russia is also very keen to bypass transit countries. "Even if they (Russians) have to build the thing running across the sky at an even higher cost, they would go for it," Baranov said. (Reporting by Tanya Mosolova, additional reporting by Gabriela Baczynska and Karolina Slowikowska in Warsaw)
Serb men gather outside a container donated by Russia that serves as a polling station in an isolated village of Bijelo Polje in Kosovo February 3, 2008. Serbia voted on Sunday ...
