ENERGY SECURITY AND THE IMPORTANCE OF EU - RUSSIA ENERGY RELATIONS By Const. S. MANIATOPOULOS Chairman, Institute of Energy for S.E. Europe IENE, Athens, Greece. Former Dir. General for Energy of the European Commission INSTITUTE OF ENERGY FOR SOUTH EAST EUROPE International Conference « Energy Security and the Geopolitics of Energy » 21st November Nicosia, Cyprus

Presentation Outline  About IENE  Introductory remarks  Energy security  The European energy strategy  Russian energy priorities  The Interdependence of the EU and Russia in the energy sector  Some concerns …  The Energy dialogue  Some conclusions

IENE is an independent n. g. organization which supports and promote energy issues and contributes to development for a better future. IENE is a valuable partner in energy for both the private and public sectors. INSTITUTE OF ENERGY FOR SOUTH EAST EUROPE

IENE’s Objectives and Goals  IENE was founded in Athens, in July 2003 by 20 independent scientists and business executives concerned with the energy sector.  It is a non-governmental, non-profit organization, a permanent forum where energy issues can be discussed, analyzed, reformulated and presented.  One of IENE’s key objective is to participate in the formulation of energy policies, both on the national and international levels, within the broader region of South-East Europe.  IENE aims to contribute to the implementation of the European Union’s sustainable development strategy that combines social and economic development with environmental protection.  The Institute plays a significant role in providing public opinion with factual and unbiased information on subject concerning energy, the environment and sustainable development.  IENE organizes public events (e.g. open discussions, workshops, seminars, conferences, etc).

IENE’s Main Activities  Information  Education  Research and Technology Development  Documentation  Cooperation with national and international organizations  Cooperation with S.E. Europe

Introductory remarks The role of energy and of energy security in international developments The relations between the European Union and the Russian Federation Review the situation and make some comments on the recent developments. Initiate a fruitful discussion

Energy security Energy security : a constant and absolute priority Security of supply for consuming countries, importers of energy goods Security of demand for producing countries, producers of energy goods Security of transit Cooperation, open and transparent markets Comprehensive political approach

The European energy strategy A comprehensive, commonly accepted by Member Countries European energy strategy is (still) lacking EU has no common foreign and security policy EU has no common European external energy strategy EU faces problems of increased energy dependence

Russia The world largest producer of hydrocarbons First place in respect of natural gas exports Second place after Saudi Arabia in respect of petroleum exports An energy colossus with a 40-year history of market reliability Energy is the decisive factor behind Russian foreign policy Russia has a sustainable energy strategy To develop its energy potential, Russia needs investment and foreign technology

The Interdependence of the EU and Russia in the energy sector Russia is EU’s third most important trading partner The EU imports from Russia amount : for more than more than 40% for gas consumption for about 25% of the total energy consumption (oil, gas, coal) or for 50% of imported energy Russian exports to EU account : for 67% of total natural gas exports for 64% of petroleum exports Gas pipelines are major issues of the energy and geopolitical realities Energy interdependence is of vital importance to both sides

Some concerns … Tensions have been rising in the EU - Russia relations. The threat of the “energy weapon” The diversification of supplies and energy routes. Russia to invest to energy routes directly controlled by Russian interests. Russia concluded commercial agreements with major gas producers

The Energy dialogue The high-level EU – Russia ‘energy dialogue’ instrument for a strengthening of the EU – Russia energy relations Condition that the political will really exists Complexity of objectives One-way process the frank and open energy dialogue Major issue the ratification of the Energy Charter and in particular of the Transit Protocol The responsibilities for the non - progress are shared.

Some conclusions The importance of energy security for consumers and producers The crucial role of energy routes The absence of a European energy strategy The importance of Russia for the EU energy supplies The energy interdependence between the EU and Russia The role of the energy dialogue for mutually beneficial energy relationship between the EU and Russia The usefulness of the Energy Charter

The most important message “The energy challenges facing Europe need a coherent external policy to enable Europe to play a more effective international role in tackling common problems with energy partners worldwide. A coherent external policy is essential to deliver sustainable, competitive and secure energy. It would be a break from the past and show Member States’ commitment to common solutions to shared problems.”

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