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OIL AND GAS
EU lays out energy plan, to reduce Russia dependence
by Staff Writers
Brussels (AFP) May 28, 2014


Russia looks to diversify its energy base by investing in Argentina
Moscow (UPI) May 28, 2013 - Russian Foreign Minister Sergei Lavrov said Wednesday he was interested in encouraging more investments in the Argentine energy sector.

Lavrov met in Moscow with Argentinean Foreign Minister Hector Timerman to discuss prospects for future energy cooperation as well as Argentina's bid to join Brazil, Russia, India, China and South Africa in the five-member economic association dubbed BRICS.

Lavrov said the outlook for Russian investments in the Argentinean energy sector was strong.

"We aren't just interested in ways to diversify our trade relations but actually want to focus on investment," he said.

Russia expressed interest in Argentina's energy market in 2012 following the nationalization of the country's YPF energy company. Russian energy companies have a presence in Venezuela and Russian energy company Gazprom is exploring for natural gas in that country as part of a Russian consortium.

Both sides have focused on development the Vaca Muerta shale site in Argentina's Neuquen province, which Buenos Aires wants developed with investor cash.

"We hope that competitive advantage of our companies interested in accessing these particular sectors of economy will be appreciated by our Argentinian colleagues," Lavrov said.

EU calls for concrete action to balance against Russian energy influence
Brussels (UPI) May 28, 2013 - "Concrete actions" from members of the European Union to diversify the gas market is the only way forward, the energy commissioner said Wednesday.

European Energy Commissioner Gunther Oettinger said EU member states need to develop stronger partnerships in the energy sphere in order to avoid falling victim to "political and commercial blackmail."

Russia supplies about a quarter of the EU's gas needs, though most of those supplies run through the Soviet-era transit network in Ukraine. In 2009, Russian energy company Gazprom cut gas supplies through Ukraine because of contractual disputes and recent tensions over Ukraine's embrace of the West have added further strains to European energy security.

"We need to accelerate the diversification of external energy suppliers, especially for gas," Oettinger said in a statement. "Only concrete actions will help."

The EU said it spends more than $1 billion per day on energy imports. More than 60 percent of the region's gas supplies come from foreign suppliers, notably Russia, Norway and Algeria.

Members of the EU have looked to Azerbaijan for sources of piped natural gas as well as liquefied natural gas from the United States.

The EU said it would maintain its relationship with "reliable" energy partners, but look for new partnerships and alternate supply routes.

The European Commission laid out plans Wednesday to cut the EU's costly reliance on energy imports, especially from Russia which has threatened to halt gas supplies to Ukraine, a key transit point for Europe.

A report prepared for European Union leaders recommended a broad series of measures to promote indigenous sources, including renewables and nuclear energy, and to make progress on a single energy market.

"Improving the internal market will mean that energy prices will be roughly the same everywhere," EU Energy Commissioner Guenther Oettinger said.

As for supply of gas, "we must move away from a monopoly supplier, Russia in this instance," Oettinger told a press conference.

Russia accounts for nearly 40 percent of EU gas imports, with half of that transiting through pipelines in Ukraine, according to Commission figures.

As the Ukraine crisis has deepened, Moscow has threatened to cut supplies -- as it did in 2006 and 2009 -- unless Kiev pays for deliveries up front.

The fear is that this would once again badly expose onward European countries, some of them totally dependent on Russia for natural gas.

EU leaders and official have suggested there could be a 'European Energy Union,' a single market complete with assured supplies and infrastructure to ensure the EU does not rely overly on any one country and so leave itself open to energy blackmail.

"We want strong and stable partnerships with important suppliers but must avoid falling victim to political and commercial blackmail," Oettinger said.

Accordingly, the EU must "complete the internal energy market, improve our infrastructure, become more energy efficient and better exploit our own energy resources.

"Moreover, we need to accelerate the diversification of external energy suppliers, especially for gas," he said.

The Commission said that in 2013, Russia accounted for 39 percent of EU gas imports by volume, with Norway on 33 percent and North Africa 22 percent.

In all, the 28-nation bloc depended on energy imports for more than 50 percent of its needs, a dangerously high level when global demand was expected to grow 27 percent by 2030, it said.

It put the import bill at more than one billion euros a day in 2012.

Business groups welcomed the Commission report.

"The situation in Ukraine is a wake-up call for a strong European energy security strategy ... (the report) ... rightly pushes for an increase and diversification of energy sources both domestically and externally," BUSINESSEUROPE said.

For its part, environmentalist group Greenpeace said the EU should not miss the opportunity to move the economy away from fossil fuels.

"Throwing money at new gas infrastructure to get Europe off Russian gas will not cure the addiction to imported fossil fuels," it said.

"Instead, Europe should kick the habit and exploit the enormous potential for energy savings and home-grown renewables by setting ambitious targets for 2030."

The Commission report is to be submitted to EU leaders at their end-June summit.

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