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International Last Updated: Jun 26, 2009 - 11:04:15 AM


EU Blasted for 'Animal Farm' Approach
By Reuters 26/6/09
Jun 26, 2009 - 11:03:10 AM

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The head of Gazprom's foreign department, Stanislav Tsygankov, told a conference attended by a senior European energy official that Brussels was unfairly supporting the Nabucco pipeline while hindering Russian projects at every step. "We are very concerned about this, about the clear inconsistency of the EU leadership's approach to the actions of our firms, which are aiming to ensure their supplies," he said.

Tsygankov's speech summed up the EU's attitude with an allusion to George Orwell's novel "Animal Farm."

"It appears that all animals are equal, but some are more equal than others," he said.

The European official, Marjeta Jager, said she agreed on the importance of securing European demand for Russia's gas but did not mince words in defending Europe's position.

"Let me set the record straight. Reputation matters in Europe," said Jager, the European Commission's director of general affairs and international energy relations.

The exchange showed that the wounds from Russia's January gas conflict with Ukraine, which saw millions of Europeans cut off from fuel supplies in the dead of winter, are far from healing.

Talks to resolve the latest sore point in relations between Moscow and Kiev -- paying some $4 billion to fill Ukraine's gas storage facilities -- are therefore not likely to be easy.

But Jager said she hoped that a resolution would be found on Monday, when officials from Gazprom and Naftogaz Ukrainy are to meet in Brussels with international banks and EU officials to resolve the payment issue and avoid another gas crisis.

But even if Monday's meeting solves the issue of gas storage, Ukraine's ability to pay for its own gas supplies for June is still uncertain. A failure to pay may yet result in another shut-off.

The Ukrainian president's energy envoy said Thursday that Naftogaz needed to scrape together $120 million by July 7 to pay last month's bill for Russian gas.

"The date of July 7 is approaching, when payment must be made for gas received in June," energy envoy Bohdan Sokolovsky said. "The funds gathered by Naftogaz are not sufficient."

Jager said Sokolovsky has been invited to attend Monday's meeting in Brussels along with Russian Deputy Energy Minister Anatoly Yanovsky, Gazprom export chief Alexander Medvedev and Naftogaz chief Oleh Dubyna.

Asked whether she was confident that the meeting would resolve the gas storage issue, Jager said, "Everyone hopes that the problem will be fixed. We do not want another gas crisis."

For the long term, Russia hopes to build pipelines that go around Ukraine, which now transports almost all of the Russian gas meant for Europe.

Europe, meanwhile, is trying to cut both Russia and Ukraine out of the equation by building the Nabucco pipeline, which could bring Central Asian gas directly to Europe.

Tsygankov said European regulators were therefore blocking the progress of Russia's projects. "Nabucco is getting the green light everywhere ... while our gas transport projects, South and North Stream, are constantly facing regulatory barriers

Source:Ocnus.net 2009

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