Europe’s dependency on Russian natural gas mirror’s Ukraine’s effort for liberation from Russia

Thanks to the political situation in Ukraine, American politics is discussing using America’s “glut” of natural gas as a political weapon.  The idea is to undermine Russia’s strength in natural gas supplies, by selling America’s natural gas into the world market, especially to critical countries most vulnerable to Russia, in order to undercut Russia.  Put another way, the US would protect specific countries from natural gas dependency on Russia.

Russia, obviously, is returning to its old role of bogeyman.  But, isn’t it alarming to see a fossil fuel used this way?

We all need to be working to rid ourselves completely from fossil fuel consumption – not work hard to continue dependency on fossil fuels, and the harmful side effects.

In any case, politicians planning to use America’s glut of natural gas for geopolitical ends is not new.  It wasn’t something they cooked up last week, they’ve been talking about this for awhile.  I wrote it up in my last blog post about Ukraine where I’d found a paper written in August 2013 by the Congressional Research Service about Europe’s Energy Security.  Tonight I thought it would be useful to go back over the document in its own right.

First – here’s a couple links to current news items discussing natural gas as a political weapon:

Here goes

A key element of the EU’s energy supply strategy has been to shift to a greater use of natural gas

The report doesn’t say why Europe is making this switch, but one imagines it’s to do with climate change and other environmental concerns.  Natural gas is supposedly cleaner, right?  The key is “cleaner” because natural gas is not “clean”, it’s still a fossil fuel, and is still increasing the CO2 content in the atmosphere.  Natural gas is also the same as methane, meaning it by itself is a more potent greenhouse gas than CO2.  All the methane which escapes from natural gas drilling and transport operations causes even more greenhouse gas damage.

In any case – geopolitically it means Europe is dependent on Norway (#1 supplier) and Russia (#2 supplier) for natural gas.  The actual amount of dependency varies from country to country, with the former Soviet-bloc countries having the greatest dependency on Russia.

The paper says Russia has not been idle in protecting its market share of natural gas in Europe.  There’s two plausible reasons for that – one is economic and political leverage over countries (“we’ll cut off your gas if you don’t do what we say”) – the other is simply the riches flowing into Russian coffers.

The paper also says this ominous statement:

Successive U.S. administrations and Congresses have viewed European energy security as a U.S. national interest.

There’s a tendency for this to mean that the US is willing to go to war to protect “national interests”.

Europe’s domestic natural gas has been declining – indicating that Europe has passed its peak of production for natural gas.  They’re caught in a no-win position, they want to increase natural gas consumption because it’s supposedly a cleaner fuel than Coal, but it makes them dependent on Russia, a country that is seeking political domination over everything.

Additionally, relations between Ukraine, Belarus and Russia have not been cozy the last few years, resulting in several instances where Europe’s natural gas supply was cut off because of arguments between Ukraine and Russia.  Europe clearly can’t afford to be dependent on untrustworthy suppliers.

One approach to energy security has led to building alternate pipelines – NordStream and South Stream – allowing Russia to sell natural gas to Europe without transhipping it through Ukraine.  It keeps Europe dependent on Russia for natural gas, but removes a particularly untrustworthy element.

Another approach is rather fraught with problems – the “Southern Strategy,” also known as the “Southern Corridor.”  The Caspian Sea region is still free’d from Russia’s sphere of influence, and has lots of natural gas.  The problem has been how to get that natural gas to market without going through Russia.  Some think the Afghanistan War was about opening a corridor for this through Afghanistan and Pakistan.  The Southern Corridor, however, goes across Turkey, to Greece and Italy.

A third approach is better integration of Europe’s energy supply grid:

  • European heads of state pledged to complete the integration and liberalization of the internal European energy market by 2014;
  • ensure all European member states are connected to a Europe-wide energy supply grid by 2015;
    boost energy efficiency throughout Europe;
  • and better coordinate external energy policies

And then there’s Fracking the shale deposits – Shale Gas.

By the way, this whole “glut” of natural gas in America is thanks to Fracking.

Since the advent of shale gas in the United States, the world appears to be potentially awash in natural gas. A 2011 study commissioned by the U.S. Energy Information Administration (EIA) showed that technically recoverable shale gas resources worldwide may exceed current global natural gas reserves.  (U.S. Energy Information Administration, World Shale Gas Resources: An Initial Assessment of 14 Regions Outside the United States, Washington, DC, April 5, 2011, p. 4,

North Africa could become a big natural gas competitor to Russia.  Regime changes in Libya and Egypt open the door to developing natural gas resources in those countries.  Algeria is thought to have large shale deposits suitable for fracking.

Europe could also turn to Liquified Natural Gas (LNG) suppliers for natural gas needs.

Thanks to the fracking in North America, our “glut” could be LNG’d and shipped to Europe.  The Dept. of Energy is working through approvals of LNG export terminals, and those terminals may go into operation during the 2015-2017 timeframe.

Generally, Europe is in a precarious situation for fossil fuel energy supply:

Collectively, EU member states are the world’s largest energy importer, importing about 55% of their energy supply—approximately 84% of their oil and 64% of their natural gas. EU member states increasingly rely on natural gas, particularly to reach ambitious targets to reduce carbon dioxide and greenhouse gas emissions. Natural gas comprised 24% of the EU’s primary energy consumption in 2011, a number that is expected to grow to almost 30% by 2030. Oil made up about 37%, coal almost 18%, and nuclear 12% of the EU primary energy supply. Coal use rose between 2011 and 2012, in part supplied by increased U.S. coal exports. The European Commission forecasts that the EU will import over 80% of its natural gas needs by 2030. Analysts note that recent policy decisions, such as a 2011 German announcement that it would phase out use of its nuclear power plants by 2020 and possible prohibitions on shale gas development by some EU members, could mean a more rapid rise in Europe’s dependence on natural gas imports.

This kind of dependency allows other countries to have inordinate control over ones destiny.

That last bit about phasing out nuclear power, and banning shale gas development (fracking), is interesting.  The paper is positioning natural gas as the only other energy source alternative to coal or nuclear power.  What about wind power?  Solar power?  Europe is doing big things with developing wind power, and Germany is a big example of solar power deployment on a big scale.

Poland and the Baltic states are said to be warning other European countries against becoming dependent on Russia’s natural gas.

Such instances of individual member states dealing with Russia bilaterally have in the past drawn harsh criticism from other EU member states, such as the Baltic states and Poland, that have had strained relations with Russia for some time over other issues as well. Governments in these countries have warned their European colleagues not to make energy deals that could give Russia increased political influence over European decision-making. Many of these nations believe that Europe’s dependence on Russian energy is likely to last no matter how successful Europe may be in identifying energy supply alternatives. But they also feel Europe does not gain real security by becoming more dependent on Russia. In fact, the growing presence of Gazprom throughout the European energy market (for instance through its ownership of distribution and storage infrastructure) has led many to worry about the EU’s ability to develop an energy policy insulated from Gazprom’s influence.

An example may be the Southern Corridor plan – which, in the current plans, is about half the capacity that was originally intended, and most of that capacity is allocated to Turkey, with a small amount being shipped to Greece, Albania and Italy.  The problem is that Russia (Gazprom) objected strongly to the larger version of the Southern Corridor project, but did not object to the smaller project, while at the same time Russia has pushed forward with the South Stream project that’s in direct competition.

Russia is in a strong position, having 18% of the worlds natural gas reserves.  Natural gas exports are lining the pockets of Russia’s elites, and Russia’s rulers see their natural gas dominance as emblematic of Russia’s resurgence as a world power.  Russia is seeking to diversify its customer base by selling natural gas to Asian countries, like China and Korea.  Russia could play a big role in China decreasing its dependence on coal, which would be a good thing.

Since Europe is heavily dependent on Russian natural gas, and Russia is working hard to maintain that dependency, how can Europe’s free itself from Russian dominance?

Establishing a non-Russian and non-Iranian route to deliver natural gas and oil from Central Asia to Europe is, well, like threading a needle with a camel.  Or something like that.

The Trans Adriatic Pipeline (TAP) is slated to carry 350 billion cubic feet per year, and go into service in 2019.
The Trans-Anatolian Gas Pipeline (TANAP) is slated to carry 565 billion cubic feet per year, and go into service in 2019.
The Nabucco West Pipeline is slated to carry 350 billion cubic feet per year, and has no planned service date.
South Stream, is nearly ready to start running, is controlled by Gazprom for carrying Russian natural gas to Europe, and slated to carry 2,200 billion cubic feet per year.

The EU and US hopes to offset Russian dominance with Central Asia natural gas is up against a big size problem.  The Russian owned pipeline (South Stream) is far bigger.  Period.

The proven natural gas reserves of Azerbaijan, Kazakhstan, Turkmenistan, and Uzbekistan are estimated at over 1,000 tcf, among the largest in the world.  The problem is getting that stuff to market without it passing through unfriendly countries.

These Central Asian countries could start supplying other Asian countries like Pakistan, India and China, if the necessary pipelines can be built.

Algeria is a large fossil fuel producer already, and it’s thought that with fracking their shale deposits could make them a major major natural gas supplier.  But, business regulations in Algeria apparently make it difficult because by law any fossil fuel operation has to be at least 51% owned by the state-owned fossil fuel company.  Algeria has at least one pipeline to Europe, that goes to Spain.  But Spain’s natural gas system doesn’t then connect to France, making this of little use to Europe as a whole.

Since the Arab Spring, Egypt has had a decline in natural gas production and exports.  Egypt’s exports to Europe are LNG rather than pipelines.

In Libya, the civil war halted natural gas production, but that’s resuming.  Libya has a pipeline to Italy, and an LNG export terminal.

Both Cyprus and Israel have identified natural gas deposits in the Mediterranean.  They could eventually begin exports to Europe.

Up in the Arctic, Norway has significant opportunities in the Barents Sea.

Finally, Europe has untapped shale deposits that, if fracked, could provide a whole lot of natural gas.  About 25 years worth at current consumption rates.  But of course this requires fracking.

In short, Europe is in a tough place.  They don’t have their own fossil fuel resources, unless they unleash a wave of Fracking.  Instead they’re looking at far-flung places for “energy” while developing renewable energy resources.  It’s whimsical to ask “how did my oil get underneath their sand” but it’s geopolitically bad for a country to be dependent on distant energy supplies.  First, why doesn’t the country which has those supplies exploit it to enrich their own people and industrial base?  Second, it still means Europe is dependent on another country for energy supplies.  Who says that Azerbaijan won’t be just as bad as Russia, for example?

Ultimately we all need to stop using fossil fuels.  Why not put all this energy towards that goal?

About David Herron

David Herron is a writer and software engineer living in Silicon Valley. He primarily writes about electric vehicles, clean energy systems, climate change, peak oil and related issues. When not writing he indulges in software projects and is sometimes employed as a software engineer. David has written for sites like PlugInCars and TorqueNews, and worked for companies like Sun Microsystems and Yahoo.
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About David Herron

David Herron is a writer and software engineer living in Silicon Valley. He primarily writes about electric vehicles, clean energy systems, climate change, peak oil and related issues. When not writing he indulges in software projects and is sometimes employed as a software engineer. David has written for sites like PlugInCars and TorqueNews, and worked for companies like Sun Microsystems and Yahoo.


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