Clearing the muddy waters of energy security: Q and A sessions with Amos J. Hoschstein and Antony J. Blinken
- Written by Vlad-Adrian Iancu
Energy security is not a new subject. It’s been around for quite some time. In an age where nothing is safe anymore, where wars start everyday and international relations are strained by constant struggles for power and influence, energy seems to be on the back of the agenda. In these troubled times we find that this is not the case at all. It’s only the tip of the iceberg right now but if left unchecked it could very well sink the whole world. Don’t even think of a world where energy is no longer a commodity. We don’t want that. But, if all goes according to plan, and the powers that be figure it out, we won’t have that. Cooperation seems to be the keyword here. Let’s see how Romania figures in this grand scheme. No doubt action will come. For the moment, let’s ask the right questions.
The Brussels Media Hub seems to be doing that. The man to answer these questions is Amos J. Hochstein - Special Envoy and Coordinator for International Energy Affairs, coming from Washington and riding the fresh wave of attention that the US-EU Energy Council has generated. His insights on this and on energy security and cooperation are as follows. His first remarks were obviously about the recent Energy Council. He retraced its steps back to 2009 when it was formed by Clinton and Obama as a mechanism for cooperation and collaboration between Europe and U.S. on matters of energy security but not limited to that. It was shaped as a response to the energy crisis that appeared when Russia cut the gas to Ukraine and its recipients. Back to the present, the latest meeting was presided over by Secretary of State John Kerry, EU High Representative Federica Mogherini, United States Secretary of Energy Dr Ernest Moniz, Vice President for the Energy Union Maroš Šefčovič and EU Commissioner Miguel Arias Cañete.
The first topic on the agenda was the issue of energy security. The lingering concern is that energy is still being used as a deterrent and political tool in certain parts of Europe. That being said, it is a known reality that the situation in Eastern, Central Europe and the Baltics is highly different from Western Europe where energy is flowing freely. The highlights were the LNG terminal in Klaipeda, Lithuania; the electricity interconnection from the Baltics to Scandinavia; the same electricity interconnection between the Baltics and Poland as well as the new LNG terminal in Poland. Mr Hochstein also mentioned the first U.S. LNG exports cargo arriving in Lisbon which mark a new cornerstone in the relation between the US and European markets. Contrasting with this, the ever present lack of infrastructure in Eastern and Central Europe is still stunting the receiving of new gas and new energy products. This is a shame seeing as the gas prices arriving in Europe have become so cheap. But there seems to be a solution on the horizon: the LNG terminal in Croatia, in the Adriatic in Krk Island. But in order for that to become a reality there is need of a similar floating LNG terminal in Greece and the IGB (interconnector between Greece and Bulgaria) coupled with interconnection between Bulgaria and Serbia, and others to follow. The road ahead is still quite bumpy.
“This is not about Russia, it’s not against Russia. It’s about competition for Russian gas”
Another topic of discussion was the pipeline that goes from Azerbaijan through Georgia, Turkey, into Greece, Albania and Italy. In the north it also connects to Bulgaria. This is not only about commerce but also geopolitics. Keep an eye on this one; it’s marked as a priority for U.S. national security. Nord Stream 2 was again discussed as a rift between the east and the west with consequences that could extend to generations to come. The economic viability of Ukraine and Slovakia seems to be at stake. The message is clear: Nord Stream 2 is not compatible with the Energy Union project or with energy security. Again the solution seems to lie in the Southern Gas Corridor, a solution more cost-effective. COP 22 was mentioned briefly as another landmark for cooperation but also for helping countries in need.
Let’s see about those questions and what they cleared up. Firstly, there are a lot of smaller projects that distract from the big ones. We should consider the interconnector between Greece and Bulgaria, the TAP, the Croatia terminal with a connection to Hungary, along with smaller projects between Bulgaria and Romania and Hungary and Romania. Apart from these, the rest are just background noise in Mr Hochstein’s opinion. Another big point was made about capping production. Those were named artificial interventions and deemed wrong. The U.S. is firmly against them. What U.S. does favour is Azerbaijan. As a critical player in the Southern Gas Corridor and a major exporter, Azerbaijan is envisioned to also become a transit point. It is compatible with the U.S. The future seems to be bright.
“There are enormous amounts of gas coming onto the market over the next five years from the United States, from Australia, and from other places. The United States and Australia will have as much gas coming on the market as Qatar is exporting today” - Amos J. Hoschstein, Special Envoy
Mission Innovation is still very much in the books, and global warming still a hot topic. As we cannot make the transition in one day, natural gas will still be used as compared to coal that is in the process of elimination, even though some continents (Asia) still consider it an option. Greece is on the rise, as another top player in the industry of energy given its position on the map. Another transit system is in the cards.
“Greece is a natural place for LNG cargoes to land and to serve as a transit point into the rest of Europe” - Amos J. Hoschstein, Special Envoy
Let’s get another point of view, from Anthony J. Blinken U.S. Deputy Secretary of State. His latest meetings dealt with the upcoming NATO Summit, energy security, Ukraine, Daesh and the refugee migration challenge. After a brief exposition on all these matters the Q and A started. And we learned this: the keyword for energy security is diversification (sources, supply, routes). No single country should dominate the energy market and make it into a tool of coercion. Significant progress is being made in the Bulgaria - Greece - Romania relationship. It’s simple to sum it all up: Energy security will be a team effort or it won’t exist at all.