Desperately seeking alternatives

By bne IntelliNews January 20, 2009

Nicholas Watson in Prague -

The duration of the gas dispute this time around has heightened the sense in Europe that much more needs to be done to protect the region's gas supplies from the effects of such spats between Russia and Ukraine, outside of building more pipelines from Russia or the Caspian.

Most worrying for the EU is that several Central and Eastern European governments are now talking about restarting nuclear reactors that had been, or were to be, mothballed due to concerns over their safety. On January 12, Bulgarian Prime Minister Sergei Stanishev said he had told the European Commission that if the supply cut-off dragged on into February, the government would have to restart one of the two 440-megawatt (MW) Soviet-era units at the country's only nuclear power plant, Kozloduy, that were closed at the end of 2006 as a condition for joining the EU. Slovakia also said it was planning to restart its Bohunice nuclear power plant, criticised by neighbouring Austria as unsafe, which it shut down at the end of 2008.

If the Commission's stance over Lithuania's attempts over the past year to keep open its aging Ignalina nuclear power station are anything to go by, analysts say Bulgaria's appeal will fall on deaf ears. Wrangling between Lithuania and its Baltic and Polish partners in building a replacement nuclear plant on the site has delayed the project, so Vilnius has been pushing the Commission without any success to keep the old plant open past the 2010 deadline to close it.

Poland is also planning to build nuclear plants on its own soil as opinion grows that Russia is wielding energy as a political weapon "with increasing impunity," says Marek Matraszek, founding partner of CEC Government Relations in Warsaw. On January 13, the government approved the commencement of a nuclear energy programme that will see two nuclear power generation plants built over the next 15 years.

Poland is also looking at liquefied natural gas (LNG) as a way to wean itself off Russian gas. The government said it is will submit a bill to parliament to accelerate the tender and construction procedures of the LNG terminal at Swinoujscie, which is planned to have a capacity of more than over 2.5bn cubic metres (cm) and an original completion date of 2013/2014. Design work is already underway. The government will also try to secure a long-term LNG supply contract, possibly with Qatar. Another LNG facility is being planned on Krk Island off the Croatian Adriatic coast by the Adria LNG consortium, which comprises E.On Ruhrgas, OMV Gas & Power, Total Gas & Power Ventures, RWE Supply & Trading, and Geoplin. Construction is slated to start at the end of 2009 and the facility up and running by 2014. The Krk facility is set to have an initial annual capacity of 10bn cm and cost a little over $1bn.

Storage is another area in the region that can be improved. RWE Gas Storage said the total capacity of all gas storages in the Czech Republic should increase to 4.3bn cm by 2013, thus covering almost half of the country's annual consumption, from the current 3bn cm of capacity. Bulgaria is looking for €250m from the EU to expand its sole gas storage facility at Chiren.

Related Articles

Drum rolls in the great disappearing act of Russia's banks

Jason Corcoran in Moscow - Russian banks are disappearing at the fastest rate ever as the country's deepening recession makes it easier for the central bank to expose money laundering, dodgy lending ... more

Kremlin: No evidence in Olympic doping allegations against Russia

bne IntelliNews - The Kremlin supported by national sports authorities has brushed aside "groundless" allegations of a mass doping scam involving Russian athletes after the World Anti-Doping Agency ... more

PROFILE: Day of reckoning comes for eccentric owner of Russian bank Uralsib

Jason Corcoran in Moscow - Revelations and mysticism may have been the stock-in-trade of Nikolai Tsvetkov’s management style, but ultimately they didn’t help him to hold on to his ... more

Register here to continue reading this article and 2 more for free or 12 months full access inc. Magazine and Weekly Newspaper for just $119/year.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

IntelliNews Pro subscribers click here

Thank you. Please complete your registration by confirming your email address. A confirmation email has been sent to the email address you provided.

Thank you for purchasing a bne IntelliNews subscription. We look forward to serving you as one of our paid subscribers. An email confirmation will be sent to the email address you have provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

If you have any questions please contact us at

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

IntelliNews Pro subscribers click here

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

Thank you. Please complete your registration by confirming your email address. The confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.