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European Commission - Speech - [Check Against Delivery]

Commissioner Arias Cañete at the European Parliament Plenary: opening and concluding remarks

Strasbourg, 7 October 2015

Opening remarks

Honourable Members,

Allow me to start by reinforcing a key message: Ensuring secure and resilient energy supplies to EU citizens and companies is a top priority for the Commission.

In the coming months alone we will:

  • Put forward review of the Security of Gas Supply Regulation
  • Publish a new comprehensive LNG and storage strategy
  • Propose changes to Intergovernmental Agreements (IGAs) to make sure they are in line with European security of supply objectives.

And it is also why we have committed to diversifying our energy sources, suppliers and routes.

The goal is simple: Putting an end to overdependence on a single supplier or route and give each Member State three potential sources of gas, be it from pipeline gas from different sources, LNG or storage. In this regard we count on a rapidly growing market for LNG which will allow us to more than double our imports from around 40 billion cubic meters to up to 90 billion cubic meters by 2020; we will invest in modernizing our storages and accelerate the work of better interconnecting the Member States.

We are making good progress in these areas. In fact in the last few months alone we managed to have first tangible results in those regions still insufficiently linked with the internal market.

Let me give you a few examples:

  • The new high-level group on Gas Connectivity in Central Eastern and Southeast Europe will increase interconnections in that region in the post-South Stream world.
  • The political agreement in July between Spain, Portugal and France on the development of the MiDCAT pipeline will increase gas interconnection capacity between the Iberian Peninsula and the rest of Europe. We are hopeful that the MIDCAT is operational by 2020.
  • Work is also on track for a first delivery of 10 billion cubic meters per year of gas from Azerbaijan to Europe in 2020 through the Trans-Anatolian (TANAP) and the Trans-Adriatic (TAP) pipelines.
  • The restructured Baltic Energy Market Interconnection Plan (BEMIP) will be our key instrument to fully integrate the Baltic countries into Europe. Just next week we will see that to come to fruition when the agreement on the GIPL gas interconnector between Poland and Lithuania will be signed. That project includes an EU contribution of almost 300 million €.

I cannot stress how important that work is because as it stands, the EU still imports around a third of its gas from Russia, about half of which currently transits Ukraine.

Which brings me on to Nord Stream 2

  • The Commission has taken note of the shareholders agreement to build two further stretches of the Nord Stream pipeline. 
  • The first thing to say is that Nord Stream 2 remains a commercial project. And of course, it will be for commercial parties to decide which infrastructure is viable for them. 
  • But let me be clear: as with any other pipeline in the EU, this pipeline will have to fully respect EU law, in particular the Third Energy Package, but also environmental, competition and public procurement rules.
  • The Commission will assess it rigorously against the European regulatory framework. That assessment will be done on its own merits.  
  • Transport capacity from Russia is currently only used at around 50% rate and that already well exceeds the EU's needs for likely future supplies. If constructed, Nord Stream 2 would – according to our estimates - increase excess transmission capacity from Russia even further. 
  • I want to stress that the Commission actively supports efforts to ensure that Ukraine is and will remain a stable and reliable transit route.

Let me finish by underlining that the EU remains open for Russian gas and we would like to see Russia as a reliable supplier of natural gas in future; but we would also like to see that the transport of Russian gas fits into our diversification strategy and that the Russian supplier as any other supplier in the EU plays to our competition and energy market rules. Thank you.

Concluding remarks

I would like to thank you for your comments. I am very glad that we are very much on the same line on this topic.

Let me repeat that in the context of energy security, diversification is key. Diversification of routes and of sources.

Nordstream 2 does not follow this core policy objective. On the contrary: if constructed, it would not only increase Europe's dependence on one supplier, but it will also increase Europe's dependence on one route.

More precisely, the project would dry out the transit through Ukraine, concentrate 80% of Russian gas imports on one route and would lead to a dominant position of Gazprom on the German market by increasing its share from 40 to over 60%.

Therefore the alignment of this project with our European energy strategy of security of supply raises serious doubts.

In this spirit, it is crucial to preserve safe transit through Ukraine, which today represents about half of Russian gas coming to the EU.

As I said before, there is overcapacity for the transport of gas from Russia.

For these reasons the Nord Stream 2 project cannot ever become a project of common interest.

It cannot ever benefit from EU financing or EU support.

I reassure you that we will continue our rigorous assessment of the Nord Stream 2 project, in particular to ensure full respect of the Third internal energy market legislation – regardless if Russia pursues its challenge in front of the WTO. We will get in touch with the designated pipeline operator and the German Regulator who will be in charge for the certification of the pipeline operator in order to find out more about the details of the project.

On that basis the Commission will draw its conclusions on the legality of the Nord Stream 2 project and the next steps to be taken by the Commission. I will keep you informed about any major development of this matter.

It is for companies to decide whether the Nordstream project is commercially viable or not. But, if the project is implemented, the task of the Commission is to ensure that the full compliance with the EU acquis is respected. I will pay personally attention to that.

Thank you.


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