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Nord Stream-2 and US sanctions 

Alex Ivanov. Moscow Correspondent

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Washington's threats of sanctions against the Nord Stream-2 project are nothing more than attempts to oust Russia from the European gas market with non-market instruments. This was stated by the head of Gazprom export ("daughter" of Gazprom PJSC) Elena Burmistrova, speaking at online conference, writes Alexi Ivanov, Moscow correspondent.

"Unfortunately, there is an additional threat, which increasingly affect our co-operation is a political confrontation in General and, in particular, the threat of US sanctions against the Nord Stream-2," she said.

According to Burmistrova, American suppliers of liquefied natural gas (LNG) have disturbed the European market and are unable to stabilize him. "Now the US is trying to oust Russia using non - market instruments," the top Manager believes.

US threats to impose sanctions on Nord stream 2 are attempts to oust Russia from the European gas market with non – market instruments, said Elena Burmistrova.

Earlier, Russian Ambassador to the United States Anatoly Antonov said that the actions of the American side in relation to the "Nord stream – 2" are caused by the desire to make Moscow pay for an independent foreign policy.

Meanwhile, in early October, Denmark found a way to circumvent US sanctions against Nord Stream-2. According to many news reports, Copenhagen, which had been dragging its feet for many years with a permit to build the pipe, gave the go-ahead for its operation in advance and how this would affect the completion of the project.

On the first day of the work of the new Polish government, in which the position of Deputy Prime Minister responsible for national security was given to the Russophobe Jaroslaw Kaczynski, the head of the Polish antitrust regulator UOKiK Tomasz Krustny said that his Department had completed the investigation on Nord Stream-2 the day before and decided to impose a fine of 29 billion zlotys ($7.6bn) on Russia's Gazprom. In Warsaw they are convinced that the project participants should have previously notified UOKiK and received consent.

"We are talking about construction without the consent of the Antimonopoly German Chancellor Angela Merkel makes similar statements: "We have different views on Nord stream-2. We consider this project an economic one. We are in favor of diversification. The project does not constitute a threat to the diversification," said the politician at a meeting with Polish Prime Minister Mateusz Morawiecki in February 2020.

The Germans are really in favor of diversification. The German energy doctrine for the next three years refers to the construction of terminals for receiving liquefied natural gas (LNG). Simply put, Berlin was going to import fuel from other suppliers: Americans or Qataris. This looks somewhat strange, given the current relations between Germany and Gazprom (in which Germany has every chance to become a key player in the European energy market). At the same time the cost LNG is definitely more expensive than main gas. Not to mention that the construction of LNG infrastructure also costs money (at least 500 million euros for one terminal in Brunsbuttel, according to Bloomberg).

On the other hand, the same German energy doctrine prescribes a complete rejection of the use of coal (by 2050). This is done for environmental reasons. Coal is an inexpensive fuel, but its use is dangerous because of harmful substances released into the atmosphere. Gas is a much safer type of fuel for the environment. It turns out that the demand for it from Germany will grow, but the Germans will not be able to meet their gas needs by importing LNG from the United States and Qatar. Most likely, Berlin's plans for liquefied natural gas are just a step to diversify supplies, but the country will not be able to refuse Russian fuel, experts say..

Germany has always been the main lobbyist for the construction of Nord Stream-2. This is understandable: after the gas pipeline is put into operation, Germany will become the largest gas hub in Europe, gaining both political points and financial flows. Two German companies are taking part in the construction of the second branch of Nord stream: E.ON and Wintershall (both have 10% each).

The other day, German foreign Minister, Heiko Maas, claimed that the gas pipeline project is economic. "Nord stream-2 is a project within the private economy. This is a purely commercial, economic project," Maas was quoted as saying by TASS.

German Chancellor Angela Merkel makes similar statements: "We have different views on Nord stream. We consider this project an economic one. We are in favor of diversification. The project does not constitute a threat to the diversification," said the politician at a meeting with Polish Prime Minister Mateusz Morawiecki in February 2020.

It seems that no one else in Europe cares about the issue of US sanctions in connection with the construction of the Nord stream - 2 gas pipeline. They have long understood that their own economic interests are much more important than American claims, and therefore they are trying to overcome American pressure in every possible way for the sake of their economic benefits.

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Commission approves €400 million Danish aid scheme to support production of electricity from renewable energy sources

EU Reporter Correspondent

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The European Commission has approved, under EU state aid rules, a Danish aid scheme to support electricity production from renewable sources. The measure will help Denmark reach its renewable energy targets without unduly distorting competition and will contribute to the European objective of achieving climate neutrality by 2050. Denmark notified the Commission of its intention to introduce a new scheme to support electricity produced from renewable energy sources, namely onshore wind turbines, offshore wind turbines, wave power plants, hydroelectric power plants and solar PV.

The aid will be awarded through a competitive tendering procedure organised in 2021-2024 and will take the form of a two-way contract-for-difference premium.. The measure has a total maximum budget of approximately €400 million (DKK 3 billion). The scheme is open until 2024 and aid can be paid out for a maximum of 20 years after the renewable electricity is connected to the grid. The Commission assessed the measure under EU state aid rules, in particular the 2014 Guidelines on state aid for environmental protection and energy.

On this basis, the Commission concluded that the Danish scheme is in line with EU state aid rules, as it will facilitate the development of renewable electricity production from various technologies in Denmark and reduce greenhouse gas emissions, in line with the European Green Deal and without unduly distorting competition.

Executive Vice President Margrethe Vestager, in charge of competition policy (pictured), said: “This Danish scheme will contribute to substantial reductions in greenhouse emissions, supporting the objectives of the Green Deal. It will provide important support to a wide range of technologies generating renewable electricity, in line with EU rules. The wide eligibility criteria and the selection of the beneficiaries through a competitive bidding process will ensure the best value for taxpayers money and will minimise possible distortions of competition.”

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Energy

Kazakhstan will continue to increase oil production under OPEC+ agreement

Astana Times

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Kazakhstan will continue to increase oil production in May, June and July of 2021 following the 15th meeting of OPEC (Organisation of the Petroleum Exporting Countries) and non-OPEC ministers meeting that took place virtually, the Kazakh Ministry of Energy press service reported, writes Abira Kuandyk in Business.   

“On 1 April, a ministerial meeting of the countries participating in the OPEC+ agreement took place. Collectively countries decided to increase the current production level of OPEC+ countries by 350,000 barrels per day in May and June and by 450,000 barrels per day in July,” said the Kazakh Ministry of Energy in a press statement. 

Kazakhstan’s obligation under the OPEC+ agreement states that oil production will amount to 1.46 million barrels per day for May and June and 1.47 million barrels per day for July. 

The data on the trading platform illustrates that the cost of Brent crude oil has risen in price by almost 3.6 percent and rose to US$65 per barrel. 

The Meeting welcomed the positive performance of participating countries. “Overall conformity reached 115 per cent in February 2021, reinforcing the trend of aggregate high conformity by participating countries,” said OPEC in a press statement.  

On 4 March, Kazakh Energy Minister Nurlan Nogayev participated in the 14th meeting of OPEC and non-OPEC ministers after which Kazakhstan and Russia were allowed to increase oil production to 20,000 barrels per day and 130,000 barrels per day, respectively, in April. 

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Energy

Azerbaijan unearths first gas condensate in Shafag-Asiman

Energy Correspondent

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Azerbaijan’s SOCAR has made the first gas condensate discovery in Shafag-Asiman fields, the company reported.

According to the statement: “As we reached a depth of 7,189 metres in an exploration well drilled in the Shafag-Asiman block, part of the Azerbaijani sector of the Caspian Sea, the first gas condensate was found. That meant the successful completion of the drilling of the Fasila formation in the gas field. At the same time, to fully grasp the extent and size of the reserves, appropriate technical design will be needed to drill an extra lateral appraisal well towards the structure’s arch.”

Exploration at the Shafag-Asiman block is underway as part of the SOCAR-BP venture. In accordance with the Production Sharing Agreement (PSA), the well was drilled by BP at a depth of 623 meters, using the Heydar Aliyev semi-submersible rig operated by the Caspian Drilling Company (CDC). The drilling kicked off on January 11, 2020.

Shafag-Asiman, a complex of offshore geological structures that was discovered in 1961, lies 125km south-east of Baku and covers an area of 1,100 square meters. Here the water depth ranges from 650 to 800 meters. On October 7, 2010, SOCAR and BP entered into a 30-year agreement on exploration, development and production sharing of the Shafag-Asiman offshore block in the Azerbaijani sector of the Caspian Sea. Under the contract, BP conducted a 3D seismic survey at the Shafag-Asiman block in 2012. Having examined the data, the two partners identified the location of the first exploration well and spudded it in 2020.

SOCAR is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in domestic and international markets, and supplying natural gas to the industry and the public in Azerbaijan.

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