The Belgian Luxembourg Chamber of Commerce for Russia and Belarus organized this Friday, March 14th an important conference on energy ties between Russia and the European Union.
There distinguished speakers belonging to the world of diplomacy and “majors” of the Russian energy world addressed the audience. Thus spoke HE Mark ENTIN , Russian ambassador to Luxembourg ; HE André MERNIER, former Belgian ambassador to Moscow, H.E. Aleksandr KRESTIYANOV , Deputy Permanent Representative of Russia to the EU and Didier CASIMIRO , vice President for Belgium of Rosneft .Gazprom ‘s representative in Belgium , Mr. Yuri Lavrov also made an intresting intervention.
Many personalities from the world of the press, of energy and European Affairs were there.
The Russian energy as a whole was discussed at this high-level conference . Oil and gas. Russia is the largest supplier of crude oil to the European Union. It has a modern infrastructure for the delivery of these raw materials like deep water ports in the White Sea and the Black Sea (Primarsk for example) , modern refineries. A company like Rosneft has invested in refineries in the Ruhr in Germany and Italy ( Sicily). Russia is already present in Europe thus.
Supply of Europe by Russia is a crucial point of the energy policy of the EU and therefore many meetings between energy officials of the European Union and Russian suppliers take place.
The European Investment Bank (EIB) is lending EUR 87 million to Klaipedos Nafta for the construction and operation of a new liquefied natural gas (LNG) import facility located in the port of Klaipeda. This investment is critical for Lithuania to diversify and secure its energy supply as well as provide backup in the event of gas supply failures.
The LNG terminal comprises a floating storage and regasification vessel (leased by Klaipedos Nafta), an offshore jetty including gas handling facilities and an 18 km pipeline connection to the Lithuanian gas grid, which are being financed by the EIB loan. The project is planned to be finalised by the end of 2014.
“The EIB strongly promotes security and diversification of energy supply. We therefore particularly welcome this agreement with Klaipedos Nafta, as the project will ensure the sustained supply of a key source of energy and will increase competition in Lithuania. We would obviously like to see this as the first of a series of energy projects that we could finance in Lithuania”, said EIB Vice-President Pim van Ballekom at the signing ceremony.
Lithuanian Minister of Energy Jaroslav Neverovič added: “The LNG Terminal in Klaipėda is a critical component of Lithuania’s energy strategy as it is the alternative solution for gas diversification in the short term. This EIB loan is vitally important for timely construction of the necessary infrastructure already by the end of next year. It will bring transparent competition to the gas market, with national and possibly regional consumers set to benefit.”
“We are delighted that Klaipedos Nafta concluded this loan agreement with the EIB today. This long-term loan will be the backbone of the LNG terminal’s project financing and will ensure that the project will be completed in a timely fashion. This is very important as the LNG terminal will bring competition to the Lithuanian gas market for the first time ever”, remarked Rokas Masiulis, CEO of Klaipedos Nafta.
Note to the editor:
The EIB is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals.
In 2008-2012, the EIB provided loans in Lithuania totalling EUR 1.24 billion. Infrastructure was the recipient of EIB support in line with the EU’s aim of strengthening cohesion and convergence in the European Union.
Participants recognised the progress being made by Ukraine to increase its energy security, inter alia through the modernisation of its gas transportation system, the diversification of its sources of gas, and its efforts to move forward with gas sector reforms and restructuring of NJSC Naftogas of Ukraine in line with its Energy Community commitments. They recognised that Ukraine is at a crossroads, with a major opportunity to develop beyond its important traditional role as a transit country and also become a gas hub for Eastern Europe due to its conventional and unconventional gas resources, its extensive pipeline network and its important gas storage facilities.
It was recognised that a precondition for the further development of the Ukrainian gas market and its progressive integration into the EU gas market is the development of an effective long-term strategy for the use of the gas transmission and storage assets involving all relevant stakeholders as well as a clear, non-discriminatory and stable legal and regulatory framework, in line with Energy Community commitments. In this context, the importance of ensuring both bidirectional physical flows and virtual reverse flows for gas was highlighted, with a priority being placed on facilitating a solution for such flows between the Ukrainian and Slovakian transmission system operators in accordance with Energy Community commitments.
Participants recognised substantial progress in FDI (foreign direct investment) in PSAs (production sharing agreements) of conventional and unconventional gas in Ukraine. The role of the Ukrainian gas transmission system was underlined, with Ukraine’s geographical position and existing gas transit, storage and production capacities offering significant flexibility, provided that reforms are fully implemented in line with Ukraine’s Energy Community commitments in order to strengthen the legal and regulatory framework as well as increase the transparency of the gas transit business. The importance of facilitating EBRD and EIB funding for reconstruction of Ukrainian gas transit system was highlighted. The importance of promoting a trilateral EU-Russia-Ukraine consortium for managing transit through Ukraine was stressed as this would ensure that the concerns of all the parties involved could be taken into account.
It was agreed that a consultative committee consisting of representatives of the Commission and Ukrainian authorities, the Energy Community Secretariat, the concerned EU Member States and interested companies and financial institutions would be established to provide a forum to support the continuing process of gas sector reforms in Ukraine. It is intended that this consultative committee will meet on an ad hoc basis, jointly analyse developments on the Ukrainian gas market and, as appropriate, offer recommendations to the European Commissioner for Energy and the Ukrainian Minister for Energy and Coal Industry.