What is state failure? See my conceptualisation of state failure on the right flank below.

Wednesday, October 1, 2008

Nabucco

Vladimir Socor has an interesting piece up at Jamestown. This is relevant to the geopolitics of the Afghanistan mission, in an indirect way. And it is also quite interesting in the wake of the Georgian-Ossetian-Russian-Georgian war (which from now on I'll simply abbreviate the GORGE). Investors did look quite perturbed by what happened during the summer. There were worries over bombs dropped near the BTC, even though guerrillas in Turkey had by then taken care of traffic in that pipeline by blowing up a section down in the south. Now, there is a country that would not like to see plans for Nabucco die away too much, even in the short run. That country is Hungary. So, Vladimir Socor, on how hungry Hungary is (dare you tell that joke to me here in Budapest, and I'll show you how warlike Hungarian tribes are).
Excerpt:
" With Brussels lacking a policy and Washington in the grip of two mutually contradictory policies on European gas supplies, Hungary has taken the lead in efforts to resuscitate the Nabucco project for Caspian gas to Europe. The Hungarian government, parliamentary opposition, and privately owned MOL energy company are all involved in this effort.
Heavily reliant on natural gas for its energy consumption, dependent on Russia for 80 percent of that gas, and (unlike the other Nabucco consortium members) poorly connected to international arteries for energy transport, Hungary is vitally interested in diversifying its supplies away from dependence on Russia. Even the oft-wavering Socialist government now seems to share the consensus on this issue.
Hungary has proposed hosting a Nabucco summit in Budapest for state and industry leaders from the six Nabucco consortium countries, possible supplier and transit countries, and relevant international institutions, with the participation of the EU and the United States as political supporters of this project. Hungarian Prime Minister Ferenc Gyurcsany first aired the summit initiative during his July visit to Azerbaijan and Turkmenistan, which are prospective suppliers of gas for the Nabucco project. MOL executives took part in that visit.
Hungary has appointed one of its most senior diplomats, Mihaly Bayer, as full-time special envoy for promoting the Nabucco project with countries along the producer-transit-consumer chain and international organizations. Bayer is filling a role that seems to have been all but vacated by the EU’s Nabucco project coordinator, although Nabucco is still officially a top priority of the EU."
(...)
"MOL’s president and CEO, Zsolt Hernadi, tackled the thorny issue of Iranian gas supplies for Nabucco forthrightly during his September 22 press conference in Vienna. "Nabucco will become reality if we can get Iranian gas. The companies involved in the project must bear in mind possible profits and losses; and when they do not have any guaranteed gas sources, then [the project] gets difficult. An empty pipeline is too expensive." Nabucco could be financed and built quickly if the gas supply source were clearly identified, Hernadi noted. But “perhaps we need another shock, like that of January 2006 [Russia-Ukraine gas crisis], to tackle the risks involved” (Die Presse, Vilaggazdasag, Reuters, September 23). While carefully noting that Iran could be one of several sources, the statement is probably the first time that MOL has publicly linked Nabucco’s prospects with Iranian gas. "
Potential minor obstacles down the road:
"Nabucco was originally designed a decade ago, specifically for Iranian gas. At present, U.S. sanctions are forcing major European companies (Shell, Total, StatoilHydro, and OMV, among others) to shelve their agreements of intent with Iran for gas development and turn to Gazprom. Most likely, the change of administrations in Washington will recast the terms of debate on energy security, including the issue of Iranian oil and gas development in a wider context."

1 comment:

Joshua Foust said...

Steve LeVine also discussed this from a different angle.

http://oilandglory.com/2008/09/washington-pay-attention-silver-clouds.html