an overview of challenges and issues to be addressed Michael I S A V V A Deputy Director Department of Economic Cooperation Ministry of Foreign Affairs Russian Federation State of play The EURussia energy cooperation is doing well ID: 790402
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Slide1
Institutional aspects of EU-Russia Energy Cooperation(an overview of challenges and issues to be addressed)
Michael I.
S A V V A
Deputy Director
Department of Economic Cooperation
Ministry of Foreign Affairs
Russian Federation
Slide2State of play
The EU-Russia energy cooperation is doing well
- Russian Exports of oil and gas have reached quite impressive figures
Cooperation is facing new challenges, particularly in Legal Capacity building
- Negotiations on a number of important bilateral documents, referring to the energy cooperation, remind a stalemate situation
Slide3Success stories and valuable assets
EU-Russia Partnership and Cooperation Agreement
- signed on 24.06. 1994 (Corfu Island); expired on 01.12. 2007; it is prolonged on a year by year basis according to the relevant provision of the Agreement
Draft EU-Russia Basic Agreement (intended to replace the expired PSA), negotiations started in 2008
Set of bilateral agreements on energy cooperation between Russia and EU member-countries
Slide4Projects jammed in the pipeline
Transit Protocol (within the Energy Charter process)
- negotiations started in 2000; never completed; as a result Russia officially informed the Depository on 20.08.2009 that it would not become a Party to the Energy Charter Treaty, signed in December 1994
Draft Convention on Global Energy Security
Draft EU-Russia Agreement on joint functioning of the United Electric Energy System of Russia and Energy Systems of Estonia, Latvia and Lithuania in synchronous mode.
Draft EU-Russia Agreement on the implementation of international infrastructure projects intended for energy transportation
Slide5ENERGY SECURITY No generally recognized definition, so far
(What is that?)
Was ist das?
Slide6Supply and Demand equation
Consuming countries : Energy security = Security of supply
unimpeded access to natural resources and uninterrupted supply of energy at a low price
Producing countries : Energy security = Security of demand
sustainable demand and nondiscriminatory access to markets in order to sell the energy at a competitive price
Slide7Natural Gas Pipelines of
the Former Soviet Union
CENTRE for GLOBAL ENERGY STUDIES
17 Knightsbridge, London SW1X 7LY, UK
Tel: +44 (0)20 7235 4334
Fax: +44 (0)20 7235 4338
Total capacity -164.000 km
Equator length -40.075,7 km
Slide8Merits and Benefits of energy cooperation
Russian exporters are making good money on the EU market
Triple benefit effect for the EU:
-
It gets energy resources, which are much needed to sustain its economic growth on a long term basis
- The supply of Russian natural gas is supportive to the EU goals on reduction of greenhouse emissions
- Money spent on energy products from Russia magically returns back to EU countries in form of Russian payments for equipment, goods and services
Slide9Caspian hydrocarbons as a major optionfor the diversification of energy supply
… or why Russia is so important for the energy supply of the EU
Slide10Oil Production ofAzerbaijan and Kazakhstan (mln tons per year)
Sources: International Energy Agency (IEA) Oil Information, 2011
Slide11Sources: International Energy Agency (IEA) Oil Information, 2012
Oil Production
Azerbaijan, Kazakhstan and Russia
(mln tons per year)
Slide12Sources: International Energy Agency (IEA) Oil Information, 2012
Oil Production
Azerbaijan, Kazakhstan, Russia and Saudi Arabia
(mln tons per year)
Slide13Sources: International Energy Agency (IEA) Gas Information, 201
2
State Statistics Agencies of Azerbaijan, Kazakhstan and Russia
Gas Production
(bln cub m)
of Azerbaijan, Kazakhstan, Turkmenistan and Russia
Slide14Try to bypass it …
Slide15ALL WE NEED IS … AN INTERFACE
The first US-Soviet joint space flight APOLLO-SOYZ took place on 15 July 1975
Slide16The basic importance of sovereign equality
In particular, sovereign equality includes the following elements:
(a) States are judicially equal;
(b) Each State has the right freely to choose and develop its political, social, economic and cultural systems;
Declaration on Principles of International Law Concerning
Friendly Relations and Co-operation among States
in accordance with the Charter of the United Nations, G.A. res. 2625, Annex, 25 UN GAOR, Supp. (No. 28), U.N. Doc. A/5217 at 121 (1970).
Slide17CONCLUSIONS
Cooperation with Russia will be crucial for the energy security, economic growth and prosperity of the EU
The EU market will remain of strategic importance for Russia in the foreseeable future
Therefore, the EU and Russia are strongly motivated to further promote the energy cooperation
A new Institutional Interface in the form of an Agreement (or a set of agreements) is in great demand to grant non discriminatory access to markets, facilitate flow of capitals and protection of investments in energy assets
The principles of equal rights and mutual advantage shall be regarded as the basis for the Institutional Capacity Building in this area
Long term contracts and their essential provisions, particularly the
“
take or pay
”
rule, remain crucial for the reliable energy supply, as well as for a fair share of risks and benefits between producers and consumers of energy resources.
Slide18Спасибо!
Thank you!