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Vladimir Putin cut the Balkan knot

Holding oil and gas resources without transportation system means nothing. The strategic importance of the Balkans, from the point of view of logistics, is so that this region can become a stumbling block on the way of both the Russian natural gas and the gas from Central Asia.

Holding oil and gas resources without transportation system means nothing. The strategic importance of the Balkans, from the point of view of logistics, is so that this region can become a stumbling block on the way of both the Russian natural gas and the gas from Central Asia.

In the beginning of XX century the Balkans were called «a powder magazine of Europe» – and there were many reasons for that. Unsatisfied ambitions of Germany, weakness of the Austria-Hungary, uncertain war position of Russia — all that had led to the situation, when problems of the Balkans became problems of all Europe. The war, launched because of those problems, buried two great monarchies at once. Despite more than a hundred years have passed, things aren’t moving: nowadays the Balkans can become the center of the hottest energy wars.

Just think about it: today the Balkans is the key region for transporting natural gas from Central Asia and Iran through Turkey to Europe. It has been proved by building of two global pipelines through the Balkan territories – the Russian-Italian South Stream pipeline and the European Nabucco pipeline. And for now at least, this war is being easily won by Vladimir Putin.

It was no coincidence that he planned his last official visit as the Russia’s president to Bulgaria. There are many reasons to finish there his foreign trips as the president: historic parallels, economic advantages in and all that just next door.

Actually, Russia and Bulgaria are thrown together by the «Burgas-Alexandroupolis» pipeline project, which has been being constructed about ten years already. Russia and Bulgaria are thrown together by the great amount of Russian tourists which hasn’t decreased since the time when Bulgaria was named «the 16th republic of the USSR». We should notice that Russia’s gas giant Gazprom satisfies 90 percent of the Balkans’ gas needs. But, despite the large number of common interests, Vladimir Putin decided to create another one, the Russian-Italy joint project, called the South Stream, through the territory of several Balkan countries.

The good-looking name means delivery of the Russian gas to Bulgaria through the Black Sea and further to Italy under the Adriatic Sea, or to Austria through a number of countries, where Gazprom has already started to construct several gas terminals. This project was attracting because of its nearness in comparison with old routes, and the ability to reduce the quantity of transit countries on a way to final gas consumers, which is very lucrative for the gas supplier. Gazprom planned to get the controlling interest in the project and leave Bulgaria with 25 percent stake. But the Bulgarian party, probably having seen all profitability of this project, decided not to agree until it will receive twice more. It was Putin's turn to take everything in his arms. He seized this moment and on the memorable date for Bulgaria (130 years of independence from the Ottoman Empire) could persuade the authorities of the country to permit the construction of the South Stream.

That visit of Vladimir Putin has almost coincided with George Bush's tour during which the president of the USA was going to negotiate the Middle East countries on increasing the oil production in order to reduce the oil prices. Bush occurred to be bad negotiator, unlike Vladimir Putin, who could convince the Bulgarian authorities to permit the launching of the project, giving them 50 pct stake in it.

It seems that George Bush will fail with the Balkans also: the actively lobbied by him Nabucco pipeline may stop its existence just on paper. At present Gazprom has all advantages to do it: the guaranteed gas deliveries to the consumers, the permission to construct a pipeline and, what is the most important, the political will of the leaders of all interested countries. Self-dependent Gazprom plans to add to its gas volumes the gas from the Shah Deniz deposit, Azerbaijan, what will kill the EU’s idea to diversify the gas deliveries to Europe. That’s what we cannot say about Nabucco: we have yet to learn, who will be the gas supplier, how it will be transported and who will consume it.

At the same time Gazprom stirred up the efforts to the Serbian direction. Earlier the gas monopoly showed interest to the state oil company NIS, but did not show a particular interest in this business. But in the end of the year Gazprom suddenly came to the company with an attractive offer - $400 million for the company and about $600 million for upgrading of the gas transportation system of Serbia and for construction of the underground gas terminal. At that time Serbian authorities rejected the offer. Gazprom did not give up hope and offered $100 million more. Serbia refused once again. However, it was the last time when Serbia refused – it was reported these days the country had approved the Gazprom’s offer concerning investments into the Balkan country in exchange for 51 pct stake in NIS company without waiting for the results of the second round of presidential elections. Besides, Gazprom got required permission to construct the South Stream.

It was reported by the country’s prime minister Vojislav Kostunica. « It is the biggest economic event in Serbia; this contract guarantees economic development to our country », said Kostunica.

Thus, the Serbian government provides the country with the stable and reliable deliveries of power resources for the decades, the prime minister emphasized. It is difficult to understand why they decided to act in that way, however, Russia’s eagerness to see Kosovo as a part of Serbia played an important role here. Having such an ally, Serbia can rest assured – the Security Council of the United Nations will never let Kosovo go.

Enlisting the support of Bulgaria and Serbia, Gazprom can turn on its European projects, knowing, that the basic gas transport routes are under its control. As it was a hundred years ago, the Balkans again began to appeal all Europe, while it is difficult to underestimate the importance of the fact that a number of gas pipelines pass through the territory of the region. If Russia and the South Stream win, the country will be provided with the economic and geopolitical prosperity for several decades ahead. If the Europeans succeed with the Nabucco pipeline, they will try to build more pipelines to develop success. Thus, today Russia is striving to keep its energy empire on the Balkans and provide safety for it. That is why Vladimir Putin didn’t play his Balkans’ gambit for so long, that is why Gazprom hurried so much to get Serbia’s support and that is why we can see the Russian gas almost worldwide nowadays.

Author: Alexander Darmin

Source : Neftegaz.RU