Speech Piebalgs over de aanleg van de Nabucco-gaspijplijn van Turkmenistan naar Zuidoost-Europa (en)

SPEECH/06/413

Andris Piebalgs

Energy Commissioner

Speech at the "Nabucco Energy Ministerial Conference"

Vienna, 26 June 2006

Ladies and Gentlemen,

The Nabucco pipeline project is a remarkable example of the benefits of co-operation. Across South East Europe, stretching from Central Austria to the end of Anatolia, five countries have decided amongst themselves to build and operate a pipeline that is breathtaking in its ambition. With a total length of 3400 kilometres, Nabucco promises to be the first great infrastructure project of the new century - especially when it is integrated into the developed and meshed market of the European Union and the producer states of the greater Caspian region. This pipeline will then transmit a sizeable proportion of Europe's gas to market.

Ladies and Gentlemen: the time is right! Over the past year we have seen the issue of security of energy supply become the issue of international relations. Across Europe, there has been a change in sentiment. Whereas previously the issue of security of supply was a technical issue reserved for the very specialised engineer or system operator, now the issue of energy security is on the table of every energy minister, as well as foreign, finance and industry ministers across Europe. Nabucco concretely - in all senses - contributes to our energy security.

I am not going to discuss the many direct benefits of Nabucco - we have representatives of the Nabucco pipeline consortium here today who I am sure can do this type of advertising. There are lessons in the way this project has been put together that are relevant across Europe. These lessons are helpful for other projects that promote diversity and competition within the European Union.

1.

The first lesson is that the gas sector is highly capitalised. It costs a lot of money for new infrastructure - and payback times for investments are very long. The co-ordination issues of gas infrastructure are particularly difficult, from the well head to the consumer; all issues must be co-ordinated and resolved in the proper order. These things are well understood in Brussels. But these things are not reflected in the way national legislation is implemented and the level of co-operation across borders - between governments and regulators - is not as good as it ought to be.

2.

The second lesson from Nabucco is the need for consensus amongst all parties. South East Europe is not unique in its dependence on one large external supplier. What the Nabucco partners have done is to meet all concerns from all parties and made a balance between the interests of the producers, the transit states, the neighbouring states and the consuming states. For large gas interconnectors, this principle of "we are all in this one big boat together" could be very helpful; solutions that are acceptable to two or three states are not good for solidarity.

Let me make some other points.

3.

It is right and proper for the European Union and Member States to keep a close eye on developments in the gas market. That is why the Commission has backed this - and other gas projects - so much.

The flip side of this observation is that producers can become dependent on consuming markets. A gas infrastructure map of Eurasia is very instructive. Black lines symbolising gas lines reach down from Russia into the European Union. There are no lines to other major markets. It is no wonder that developments in Brussels seem so important to our friends in Moscow. We recognise that our security of supply is also dependent on Russian security of demand - it is needed to fund investments. Secondly, the European Commission has outlined a plan to extend the benefits of the Internal Market to our neighbours.

4.

The overall aim is to break down the divisions on the external borders of the European Union. Just because the external border of the Union has been reached, an electron just does not turn around and go back to its generator. Nor does a gas molecule have a passport. What I am saying is that the borders of the European Union are not the borders of the energy market. In an enlarged European Union of 25, this is more obviously the case, as several Member States were integrated into other systems before they joined the EU. We cannot ignore this historical fact. So the Commission and the Council of the European Union have made it clear that we need to extend the borders of the internal energy market and extend the reach of the single regulatory framework of the European Union.

Lastly, the European Union is definitively passing from a period of relative import dependence to one of heavy import dependence. Any figures, whether from the European Union, the IEA or elsewhere, stress the need for a coherent policy response. In an era when perhaps 70% of our gas need will come from outside the European Union, we must diversify and secure adequate import capacity. This is also true for oil.

5.

Neither the European Union nor you can be passive observers to our own security. The Commission, as an instrument of the European Union, must fill the gap between reality and action. The reality is our growing dependence on imported energy. We propose to create strong legal frameworks for the trading of energy and the developments of the fuel sources in neighbouring countries, especially those through which imports may come. In that context, the Energy Community is key.

I was asked to be brief and to set the Nabucco Project in a wider political and regulatory setting. I hope it is clear to you that Nabucco is critically important to the vision of a secure Eurasian energy market, for today and for tomorrow.