The EU steals a march on NAFTA?..... [Bill]
----- Original Message -----
From: Mark Jones <[EMAIL PROTECTED]>
To: crl <[EMAIL PROTECTED]>
Sent: Monday, October 02, 2000 10:23 AM
Subject: [CrashList] FT: EU talks with Putin on Russian gas
By Michael Smith and Dan Bilefsky in Brussels
Published: September 29 2000 19:38GMT | Last Updated: October 1 2000
21:52GMT
The European Union and Russia have started talks aimed at realising a
big increase in European purchases of Russian energy supplies.
European Commission officials have suggested doubling imports of gas
from 100m tonnes of oil equivalent a year and increases in other
purchases, including oil and electricity.
"We want to move quickly," said one, who described the initiative as
the most significant commercial development between the EU and Russia
in years.
The initiative comes amid growing anxiety in the EU about European
countries' reliance on oil, prompted by the recent rise in prices to
10-year highs of well above $30 per barrel. On Friday, benchmark crude
prices were trading just below $30, but still significantly ahead of
target levels around $25.
It is understood that Romano Prodi, European Commission president, and
Vladimir Putin, Russian president, discussed the idea of a "strategic
partnership" on energy involving long-term contracts in telephone
talks on Thursday night, and are keen to move ahead with discussions.
Mr Prodi briefed EU financial ministers about the initiative over
lunch at their monthly meeting in Brussels yesterday. Aides said
Gerhard Schroder, the German chancellor, had shown enthusiasm and
executives of oil companies who met Mr Prodi last week were also
supportive.
Negotiations with Russia are likely to be fraught with complications.
Agreements would have to cover the construction of new oil and gas
pipelines and involve countries through which these would pass.
"The pipelines present a huge infrastructure problem," said one EU
official.
The EU is also keen to develop the supply of liquefied gas from
Russia.
Commission officials were talking late on Friday of a deal covering 20
years under which the EU could undertake obligations such as supplying
technology to improve the exploitation of oil and gas reserves.
Any deal would enable the EU to diversify its energy sources while
Russia would benefit from long-term contracts earning hard currency.
Meanwhile, EU finance ministers yesterday held inconclusive
discussions about the possibility of a co-ordinated release of
emergency oil stocks to try to nudge prices lower, similar to a move
announced by the US this month.
Under EU rules member states must keep 90 days of fuel supply in
reserve and the Commission has estimated that EU member states have an
average of 111 days.
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