Category: Eastern Europe

  • AZERBAIJAN-RUSSIA GAS AGREEMENT AND ITS IMPLICATIONS

    AZERBAIJAN-RUSSIA GAS AGREEMENT AND ITS IMPLICATIONS

    October 15, 2009—Volume 6, Issue 189


    by Vladimir Socor

    On October 14 in Baku, Azerbaijan’s State Oil Company president Rovnag Abdullayev and Gazprom CEO Aleksei Miller signed an agreement on Azerbaijani gas exports to Russia. The move is a logical follow-up to the June 29 agreement, signed by the same company chiefsin the presence of Presidents Ilham Alyiev and Dmitry Medvedev in Baku on that occasion–about the main principles of the gas trade between the two countries (see EDM, July 2, 17).

    This agreement turns Azerbaijan for the first time in history from an importer of Russian gas into an exporter of gas to Russiaalbeit with small initial volumesthanks to growing internal production in Azerbaijan. If understood and handled appropriately by the European Union and Turkey, this event can lend impetus to the E.U.and U.S.backed Nabucco pipeline project, notwithstanding European media speculation about Russia pre-empting Nabucco’s Azerbaijani gas supplies.

    The documents just signed involve a framework agreement for the years 2010 to 2014 and a sale-and-purchase contract for 2010. During this first year Azerbaijan shall export at least 500 million cubic meters (mcm) of gas to Russia through the Baku-Novo Filya pipeline, for use in Russia’s North Caucasus territories. Azerbaijan may increase that export volume during 2010, at its discretion. The gas may originate in any of Azerbaijan’s fields (Trend Capital, Day.Az, October 14).

    The Russian purchase price is not publicly specified. According to Abdullayev at the signing ceremony, the price-setting formula “suits the Azerbaijani side” – apparently a hint that the price is in line with the anticipated European netback prices for 2010. This had been Baku’s objective all along in the negotiations on its gas priceUnder this agreement, the price is said to be adjustable every quarter, pegged to the price of the basket of oil products (APA, Turan, October 14). Miller had proposed to buy Azerbaijani gas at $350 per one thousand cubic meters in the lead-up to the June 29 preliminary agreement.

    Azerbaijan used to import Russian gas until as recently as 2006 through the old Baku-Novo Filya pipeline, which runs for approximately 200 kilometers along the Caspian Sea coast from the Russian border to Baku. This line will now be used in the reverse mode to carry Azerbaijani gas to Russia. The volume envisaged for 2010 will use only a fraction of this pipeline’s Soviet-era capacity. In addition, Azerbaijan is preparing its own section of the old Mozdok (Russia)-Gazimahomed pipeline, for possible reverse-use as a gas export outlet to Russia (Trend Capital, October 1).

    Gas extraction in Azerbaijan is set to reach 27 bcm for 2009 (Day.Az, October 8). The rate of increase could have been faster, but has been affected by slowed-down development at the giant Shah Deniz offshore field. That slowdown in turn reflects delays on the Nabucco pipeline project and Turkish government obstructions to a gas agreement with Azerbaijan. These two factors have postponed the opening of Azerbaijan’s gas export route to the West. In this situation, Azerbaijan can only open an export route to Russia while awaiting progress on Nabucco and with Turkey.

    Meanwhile, Azerbaijan remains committed to the Nabucco project. The government and the State Oil Company are consistently reaffirming Baku’s readiness to supply 7 bcm per year for that pipeline’s first phase. Construction work on Nabucco is now expected to start in 2011, for the first gas to flow by 2015 from Azerbaijan to Europe.

    Consequently, Baku has set the time-frame of the agreement just signed with Gazprom to expire in 2014, so as to release Azerbaijan from obligations to Gazprom after that year. Miller, however, declared at the signing ceremony explicitly that Russia wants to prolong this agreement after 2015, and for larger volumes of Azerbaijani gas (Interfax, October 14). That would pose risks for Nabucco. The October 14 agreement does not.

    This agreement, however, reiterates and amplifies certain lessons for the E.U., Turkey, and U.S. that were already implicit in the June 29 preliminary agreement. Azerbaijan’s move can actually help concentrate minds all-around on the Nabucco project, bearing the following considerations in mind.

    First, the volumes committed to Gazprom are meager and the time-frame does not impinge on the Nabucco project, assuming that Azerbaijan retains the necessary Western support to pursue Azerbaijan’s own Western choice. Awaiting Nabucco’s commissioning, it makes sense for Azerbaijan to use the existing pipeline(s) to Russia for exporting Azerbaijan’s growing surplus of gas during the interim period until 2014.

    Second, this agreement does not allow Gazprom to compete against Nabucco for Azerbaijani gas. But the situation could change in Russia’s favor, if Turkey’s AKP government insists on its extortionate terms for the purchase of Azerbaijani gas and its transportation through Nabucco. By the same token, Washington and the reshuffled European Commission, now entering a new term of office in Brussels, are being reminded that they need to lift that logjam in Ankara.

    Third, Baku’s agreement with Gazprom is a reminder to Ankara that Azerbaijan does not totally depend on the Turkish gas market or the Turkish gas transmission route. From Azerbaijan’s standpoint, adding a Russian export outletalbeit a small one–is an export diversification move, away from Turkey’s perceived monopoly on transportation, which the AKP government seeks to abuse. Azerbaijan can also use the Baku-Astara pipeline to Iran, or swap arrangements with that neighbor country, during the interim period until 2014.

    Fourth, Baku is successfully resisting Gazprom’s wish to re-export Caspian gas to third countries, at a profit to Russia and at the expense of Caspian producers. Baku has stipulated that its gas shall be used in Russia’s North Caucasus. And if the Russian purchase price is consistent with European netback pricesas envisaged at the time of the June 29 preliminary agreement and, apparently, in the October 14 agreement-Baku will have achieved a strategic gain. Turkey’s AKP government would place itself in an embarrassing position by insisting on worse terms than Russia has now consented to Azerbaijan. Across the Caspian Sea, Azerbaijan will have set a useful precedent for Turkmenistan to also demand European netback prices from Gazprom. If the cash-strapped Gazprom fails to meet that benchmark, then a part of Turkmen export volumes would become available for the proposed trans-Caspian link to the Nabucco project.

    –Vladimir Socor

  • REAPING BENEFITS OF TRUCE

    REAPING BENEFITS OF TRUCE

    RBC Daily
    October 13, 2009

    Is what Moscow is after
    NOW THAT THE ARMENIAN-TURKISH BORDER TREATY IS SIGNED, YEREVAN NEEDS THE KREMLIN’S SUPPORT
    Author: Vyascheslav Leonov
    [Some profound changes are in the offing in the South Caucasus.]

         President Dmitry Medvedev met with his Armenian counterpart
    Serj Sargsjan, yesterday. The Armenian-Turkish border opened all
    over again will open a broad vista of opportunities for Russian
    Railways, but there is always the danger that Turkish capitals
    will expand into Armenia too and start herding Russian businesses
    out.
         The presidents actually met but a few days ago. It happened
    in Kishinev, Moldova, at the CIS summit where they and Azerbaijani
    leader Ilham Aliyev discussed Nagorno-Karabakh. Armenian and
    Turkish foreign ministers Edward Nalbandjan and Ahmed Davutoglu
    signed the protocols to establish diplomatic relations and open
    the border in Geneva, the following day. Profound changes are in
    the offing in the South Caucasus, so that Moscow has to adjust its
    relations with Yerevan in accordance with the new geopolitical
    realities. Sargsjan is going Turkey to a football match between
    Armenian and Turkish national teams tomorrow, so that a stopover
    in Moscow for the last minute consultations was probably a good
    idea.
         The expected opening of the Armenian-Turkish border offers a
    whole spectrum of opportunities to Russia. Foreign Minister Sergei
    Lavrov already called Russian Railways prepared to provide
    railroad service between Armenia and Turkey. Russian Railways
    obtained a 30-year concession for Armenian railroads, last year.
    In theory, the Armenian-Turkish rapprochement may even make
    railroad service between Armenia and Turkish ports possible at
    some later date.
         Medvedev and Sargsjan discussed the latest developments from
    the standpoint of new promising projects as well. Dmitry Abzalov,
    an expert with the Center for Political Situation, suggested that
    a transport corridor via Turkey might be established to allow
    Russia to export oil to Armenia. Alexander Skakov of the Institute
    of Strategic Studies, however, warned that Turkish capitals could
    be relied on to rush to the newly opened Armenian market and start
    pushing Russian businesses out.
         Alexander Krylov, an expert with the Institute of Global
    Economy and International Relations, said that Sargsjan needed the
    Kremlin’s political support at this time. The protocols signed in
    Geneva had to be ratified by the national parliaments of Armenia
    and Turkey yet. Armenian nationalists in the meantime claim that
    Sargsjan is through with the struggle for acknowledgment of the
    genocide and prepares to abandon Nagorno-Karabakh. In fact, the
    opposition already promised to ruin ratification. “Should
    ratification necessitate the use of the so called administrative
    resource, the Armenians might respond to it with mass riots, and
    Sargsjan needs the Kremlin on its side,” Krylov said.

  • Russia Reaffirms Support For Turkey-Armenia Thaw

    Russia Reaffirms Support For Turkey-Armenia Thaw

    7DDF5E73 FD20 4BFA A81C CC2544BB25B2 w393 sRussia — Foreign Ministry spokesman Andrei Nesterenko, 03Jul2009
    08.10.2009

    Russia on Thursday again voiced support for the ongoing normalization of relations between Armenia and Turkey which it said will be formalized on October.

    In televised remarks cited by AFP news agency, Russian Foreign Ministry spokesman Andrei Nesterenko described as a “very important step in the right direction” two draft agreements envisaging the establishment of diplomatic relations and reopening of the border between the two nations.

    “The signing of the Armenian-Turkish documents, set for October 10 in Zurich, will… determine the steps of the two sides on to the path of a full normalization of intergovernmental ties between Armenia and Turkey,” said Nesterenko.

    Neither Ankara, nor Yerevan have officially confirmed the date and location of the signing ceremony. “I am not giving any dates,” Turkey’s Foreign Minister Ahmet Davutoglu told reporters in Ankara earlier in the day. Let’s wait for a statement from the Swiss. As Turkey, we have no doubts the protocols will be signed.”

    Davutoglu also downplayed the uproar caused by the agreements in Armenia’s large and influential Diaspora. “Don’t listen to the voices from the Diaspora, there is no
    surprise development for us,” he said, according to the Associated Press. “Everything is happening within its natural course.”

    Meanwhile, a senior lawmaker from Turkey’s ruling Justice and Development Party said late Wednesday lack of progress Azerbaijan and Armenia towards resolving the conflict over Nagorno-Karabakh would affect Turkey’s parliamentary ratification of the agreements. “Lack of progress towards the resolution of Armenian-Azeri problems will certainly affect the parliamentary process,” Murat Mercan, chairman of the parliamentary foreign affairs committee, told Reuters.

    Turkish Prime Minister Recep Tayyip Erdogan has likewise repeatedly stated that Turkey will not open its border with Armenia as long as the Karabakh dispute remains unresolved. The Turkish-Armenian agreements make no reference to the conflict.

    https://www.azatutyun.am/a/1847088.html
  • Ukraine-Russia Tensions Evident in Crimea

    Ukraine-Russia Tensions Evident in Crimea

    Kremlin Asserting Its Influence in Region
    By Philip P. Pan
    Washington Post Foreign Service
    October 6, 2009

    SEVASTOPOL, Ukraine — On maps, Crimea is Ukrainian territory, and this naval citadel on its southern coast is a Ukrainian city. But when court bailiffs tried to serve papers at a lighthouse here in August, they suddenly found themselves surrounded by armed troops from Russia’s Black Sea Fleet who delivered them to police as if they were trespassing teenagers.

    The humiliating episode underscored Russia’s continuing influence in the storied peninsula on the Black Sea nearly two decades after the fall of the Soviet Union — and the potential for trouble here ahead of Ukraine’s first presidential vote since the 2005 Orange Revolution.

    Huge crowds of protesters defied Moscow in that peaceful uprising and swept a pro-Western government into power. Now, the Kremlin is working to undo that defeat, ratcheting up pressure on this former Soviet republic to elect a leader more amenable to Russia’s interests in January.

    Russian President Dmitry Medvedev issued a letter in August demanding policy reversals from a new Ukrainian government, including an end to its bid to join NATO. He also introduced a bill authorizing the use of troops to protect Russian citizens and Russian speakers abroad, a measure that some interpreted as targeting Crimea.

    A group of prominent Ukrainians, including the country’s first president, responded with a letter urging President Obama to prevent a “possible military intervention” by Russia that would “bring back the division of Europe.” Ukraine gave up the nuclear arsenal it inherited from the Soviet Union in exchange for security guarantees from the United States and other world powers, they noted.

    If a crisis is ahead, it is likely to involve Crimea, a peninsula of rolling steppe and sandy beaches about the size of Maryland. The region was once part of Russia, and it is the only place in Ukraine where ethnic Russians are the majority. In the mid-1990s, it elected a secessionist leader who nearly sparked a civil war.

    Crimea is also home to Russia’s Black Sea Fleet, which is based in Sevastopol under a deal with Ukraine that expires in 2017. Russia wants to extend the lease, but Ukraine’s current government insists it must go.

    “It would be easy for Russia to inspire a crisis or conflict in Crimea if it continues to lose influence in Ukraine,” said Grigory Perepelitsa, director of the Foreign Policy Institute in the Ukrainian Diplomatic Academy. “That’s the message they’re sending to any future president.”

    Russia’s state-controlled media, widely available and popular in Crimea, have hammered the authorities in Kiev as irredeemably anti-Russian, and prominent Russian politicians have been calling for reunification with Crimea.

    But five years of policies in Kiev aimed at drawing Ukraine closer to Europe and the United States and at promoting Ukrainian language and history have also alienated the region. Ukraine’s president, Viktor Yushchenko, the hero of the Orange Revolution, won only 6 percent of the vote here.

    “He tried to force his ideology on us, and he failed,” said Valeriy Saratov, chairman of the Sevastopol city council. “We don’t feel we were conquered by Russia, but by Europe. We fought the Italians, the Germans, the French, the British. . . . We would never take sides against Russia.”

    Vladimir Struchkov, a pro-Russia activist and leader of a parents’ organization in Sevastopol, said residents are especially upset about a new regulation requiring students to take college entrance exams in Ukrainian, eliminating a Russian option.

    While Kiev is playing identity politics, he argued, Moscow has been investing in Sevastopol, building schools, apartments and pools, repairing monuments and even opening a branch of Moscow State University.

    The result has been a sharp shift in Crimean attitudes. In 2006, about 74 percent of Crimean residents regarded Ukraine as their motherland, but by last year, that figure had fallen to 40 percent, according to a survey by the Razumkov Center, a top research institute in Kiev.

    Crimea became part of the Russian empire in 1783 after a long period of rule by Crimean Tatars, an indigenous Turkic people. During World War II, Germany captured the peninsula. After the war, the Soviet Union’s Joseph Stalin accused the Tatars of Nazi collaboration and ordered their mass deportation. The Communists then sought to resettle the peninsula with politically reliable families, mostly Russians with ties to the military or the party apparatus.

    When the Soviet Union collapsed, these people suddenly found themselves living in Ukraine instead of Russia, because Soviet leader Nikita Khrushchev had transferred Crimea to Ukraine in 1954 in a move that had little impact at the time.

    Today, about 60 percent of the region’s 2.3 million residents are Russian and 25 percent are Ukrainian. But the two ethnic groups are thoroughly intertwined. Opinion polls show majorities of both want the Black Sea Fleet to stay and support reunification with Russia, though there is similar support for greater autonomy for Crimea within Ukraine.

    Crimean Tatars, who were allowed to return in the 1980s, make up about 10 percent of the population and are largely opposed to a return to Russian rule.

    Refat Chubarov, a leader of the main Crimean Tatar political organization, said Russian media have vilified his people as criminals, playing on fears of Islam and their efforts to reclaim lost homes. But even among the Tatars, frustration with Kiev is rising.

    “We are the strongest supporters of Ukrainian sovereignty in Crimea,” Chubarov said. “But the disappointment is growing because the authorities have not done enough to provide land and other compensation to returning families.”

    Volodymyr Pritula, a veteran journalist and political analyst in Crimea, said the Kremlin has been trying to provoke ethnic conflict in the region, both to undermine the Ukrainian government and provide an excuse for intervention.

    Three years ago, Vladimir Putin, then Russia’s president, offered to help resolve tensions in Crimea after a clash between Russians and Tatars and suggested that the Russian fleet should stay to “guarantee stability,” Pritula noted.

    In recent months, he added, the Kremlin has stepped up its activities, with Russian nationalist groups staging protests on Ukrainian holidays and media outlets resuming the attacks on Tatars after a pause last year.

    Emotions have been running high since Russia’s war last year with another pro-Western neighbor, Georgia. The Black Sea Fleet participated in the conflict, and Ukrainian officials infuriated Russia by suggesting its ships might not be allowed to return to Sevastopol.

    Tensions flared again this summer when Ukrainian police stopped Russian trucks three times for transporting missiles in Sevastopol without advance notice. Then came the episode with the bailiffs at Kherson Lighthouse, one of dozens of navigational markers along the Crimean coast that both Ukraine and the Russian fleet claim to own.

    Judges have tried to order the fleet to hand over various facilities before, with the Russians routinely refusing and bailiffs departing without incident. But this time, the fleet accused Ukraine of “penetrating the territory of a Russian military unit” and warned of “possible tragic consequences to such actions.”

    Vladimir Kazarin, the city’s deputy mayor, said the bailiffs stepped past a gate because no sentries were posted but quickly found the commanding officer, who asked them to wait while he sought instructions. Five minutes later, he returned with the soldiers who detained the bailiffs.

    “Relations with the fleet have generally been good,” Kazarin said. “But this just shows that people in Moscow are trying to find any excuse for conflict.”

  • Official Calls Gas Pipeline From Russia To Israel ‘Very Promising’

    Official Calls Gas Pipeline From Russia To Israel ‘Very Promising’

    JERUSALEM, October 1 (ITAR-TASS) – Project of Russian natural gas supplies to Israel via the territory of Turkey is “very promising” and it was one of the issues discussed by co-chairmen of the Russian-Israeli intergovernmental commission at talks here, First Deputy Prime Minister Viktor Zubkov, the co-chairman on the Russian side told reporters Thursday before departure for Moscow.

    “That’s a very promising project and we think we must work in that direction,” Zubkov said.

    “We have an opportunity to build a Blue Stream-2 pipeline across the Turkish territory.” he said.

    To make the project profitable, however, it is important to invite other countries, like Russia, Turkey, Israel, maybe Cyprus and some Middle East States, to take part in it, Zubkov indicated.

    “We agreed to begin with bilateral talks and, in fact, negotiations between Gazprom executives and officials from the Israeli Energy and Natural Gas Authorities of the Ministry of Infrastructures began yesterday,” he said. “They were quite successful, I was told, and the work in that field will continue.”

    “In the future, we may agree on trilateral talks with Turkey and, maybe, with some other countries, too.”

    In the course of the two-day visit, Viktor Zubkov held talks with Deputy Prime Minister Avigdor Lieberman, who chairs the intergovernmental commission on the Israeli side.

    Besides, he had meetings with President Shimon Peres and Prime Minister Binyamin Netanyahu.

  • Tatar Congress Vows To Hold Own Global Census

    Tatar Congress Vows To Hold Own Global Census

    2C36A709 7F92 4ED3 9F4B CDD95D096F7B w393 sParticipants at a conference of Tatar associations in Russia in July 2009.
    September 28, 2009
    KAZAN — The World Tatar Congress has resolved to hold a worldwide census for Tatars, RFE/RL’s Tatar-Bashkir Service reports.

    The initiative comes on the heels of a federal announcement to postpone a nationwide census originally scheduled for 2010-2013.

    “The census will be organized not only in Russia, but all over the world,” World Tatar Congress leader Rinat Zakirov said during a recent session of Tatarstan parliament.

    The Russian Statistics Committee said the census planned for 2010 was postponed because of the economic crisis.

    During the last census in Russia in 2002, Tatar organizations alleged that the number of Tatars within Russia was underreported, as local and federal authorities tried to subdivide them into various ethnic groups.

    There are said to be some 5.5 million Tatars living in Russia and an estimated 1.25 million in Uzbekistan.

    https://www.rferl.org/a/Tatar_Organization_To_Hold_Worldwide_Census/1838444.html