South Stream Research Articles

Two futures: EU-Russia relations in the context of Ukraine.

The enduring crisis in Ukraine presents the European Union (EU) with a conundrum. Should it strengthen its economic and energy ties despite Russia’s growing assertiveness in the hope to solidify its medium term energy security and reel in Russian foreign policy? Or should it rather continue to tighten the screws on the Putin regime, in the hope that doing so will concurrently compel the Russian Federation to moderate its behaviour? This paper argues that it is not prudent for the EU to decrease cooperation with Russia in the short term, but rather push for a political solution without additional sanctions and in the long-term secure different fossil resources such as LNG and different suppliers such as Iraq and Iran. Whichever way the EU chooses, Ukraine’s role in EU energy security is depreciating. Nevertheless, the EU possesses a stronger bargaining position than widely believed because Russia lacks a credible alternative to European foreign direct investments (FDI). The EU should (1) establish an energy union that includes gas storage and distribution plans and extends the Energy Community to include Turkey to pave the way for future gas flows; (2) support infrastructure projects that increase reverse flow capacities within the EU as well as South Stream or its heirs and the Southern Corridor via Turkey to enhance import capacity; and (3) massively invest into energy research.

ANALYSIS AND RISK ASSESSMENT OF THE PROJECT "SOUTH STREAM" ON THE TERRITORY OF THE REPUBLIC OF SERBIA.

The article focuses on the identification, qualitative and quantitative risk assessment, make recommendations for non-insurance risk mitigation techniques, the development of the insurance program оbjects of the gas pipeline “South Stream”.

Standing in the way by standing in the middle: The case of state-owned natural gas intermediaries in Bulgaria

Bulgaria is a significant natural gas transit state in the EU (a role set to increase with the South Stream and potential Nabucco West gas pipelines) and a Member State subject to EU regulation. As a result, the regulation of natural gas in the country is of direct relevance to the development, implementation and realisation of EU energy security policy. However, the transposition of the EU’s Third Energy package seem to be dependent on the role of intermediaries in the process of transiting natural gas through and within Bulgaria. This paper uses a conceptual frame which merges literature on energy infrastructure networks, intermediaries and power to explain some key problems for natural gas supply policy in Bulgaria and the lack of transparency within the sector. The conclusion offers an explanation of how the existence of Bulgarian intermediaries influences the use of national natural gas pipelines as transmission belts for national, Russian and EU policy, as well as a series of objectives including: increasing household gasification, further liberalisation of the Bulgarian natural gas market and increasing transparency in Bulgarian energy policy.

Strategic Eurasian natural gas market model for energy security and policy analysis: Formulation and application to South Stream

The mathematical formulation of a strategic Eurasian natural gas market model is presented. The model represents horizontal oligopolistic relationships among producers, bilateral market power between producer (Russia) and transit (Ukraine) countries, detailed transport constraints, and operation decisions over a 20year time horizon. To demonstrate the model's capabilities, a financial and market analysis of the proposed South Stream gas pipeline from Russia via the Black Sea to South Europe is summarized. Insights obtained include the following. First, expectations of high demand growth in Europe and/or transit risks do not justify the construction of the South Stream pipeline because under all demand and Ukraine transit interruption scenarios, the net benefits to the South Stream participants are negative (the NPV ranges from −$1.9billion (bn) to −$7.4bn). Second, Ukraine's perception of high transit market power vis-à-vis Russia may trigger the construction of the otherwise unprofitable South Stream project. Thus, under Ukraine's high transit market power scenario, the NPV of South Stream ranges between $2.4bn and $24.5bn. Third, we find that the South Stream investment increases the efficiency of the European gas market under the following conditions: (i) when gas demand in Europe grows 2% per year up to 2030, (ii) when Ukraine poses high transit market power, or (iii) under a combination of severe transit risks through Ukraine and low demand scenarios in Europe. It should be noted that the value of South Stream to both its project sponsors and the market as a whole is much higher when Ukraine exercises transit market power than under the high demand scenario. Therefore, whether Ukraine is likely to wield market power is crucial to the success of the South Stream project because that is the only scenario in which the project yields both a positive expected NPV to its sponsors and the highest value to the market as a whole.

Investigating the potential effects of U.S. LNG exports on global natural gas markets

There have been increasing debates regarding whether the United States should export liquefied natural gas (LNG) to the global market. Using the World Gas Model, a large-scale game theoretic model, this paper investigates the potential effects of U.S. LNG exports on the domestic and global markets. U.S. LNG export scenarios relate to a Global 20/20/20 policy and competition with new pipeline projects (e.g., Nord Stream, South Stream, and Southern Corridor projects) are also considered. We find that the average U.S. domestic natural gas prices increase approximately 10.9% given 123 billion cubic meters of LNG exports and that natural gas prices in Europe and Asia decrease significantly. In addition, less expensive U.S. LNG is competitive in European and Asian gas markets and displaces more expensive suppliers in European and Asian gas markets. Under the European pipeline scenario, Russia is expected to reduce natural gas flows to transit countries by more than 50% when the Nord Stream and South Stream pipelines become available.

Nord Stream and South Stream as innovative projects, their impact on the energy sector environment and policies of the European Union

Natural gas is an indispensable resource in many industries. Its share in the primary energy consumption is relatively high, both in the European Union and globally. Energy security is a priority for each country, making the diversification of suppliers, energy sources and the construction of energy transmission systems come first in its implementation of energy policy goals. The paper discusses the following issues: – the growing demand for gas in the European Union and its consumption forecasts. Energy security – diversification of gas suppliers and transmission systems. Innovative projects Severnyi Potok (Nord Stream) and Yuzhny Potok (South Stream). Political controversies and economic reality. The analysis of media rhetoric on this topic; – do Nord Stream and Yuzhny Potok (South Stream) pose a threat to the energy security of the European Union, or are they strategically important projects, ensuring the stable and secure supplies of natural gas to EU countries? Environmental protection and the Nord Stream and South Stream pipelines. Economic cooperation between European and Russian companies in the implementation of the above projects.

Shale Gas U-Turns in Bulgaria and Romania: The Turbulent Politics of Energy and Protest

After France, Bulgaria became the second EU country to enact an open-ended ban on hydraulic fracturing in early 2012. This government action was a radical departure from an initially friendly, even enthusiastic stance on unconventional gas development. It resulted in months of unprecedented, broad political protest from environmental groups and local communities. The conflict was interpreted as one involving old questions about Bulgaria’s orientation toward Russia or the West. In neighbouring Romania, Bulgaria’s U-turn on shale gas energized a protest movement which had been relatively weak. In a turbulent election-year context, political leaders scrambled to deal with highly symbolic issues. A new government introduced a moratorium but ended it less than a year later. Another U-turn in public policy happened. Romania parted from Bulgaria’s example and set out to move forward on shale gas, aiding foreign investors. Massive protests against the policy and the investors surged, encircling the drilling operations. In both countries, public mistrust in institutions, environmental regulations and due process of law is a significant factor of political risk for energy companies. Keywords : Bulgaria, Chevron, civil society, communication, energy, energy policy, environment, fracking, hydraulic fracturing, moratorium, Nabucco, natural gas, pipelines, political risk, protest, Gazprom, Romania, Russia, shale gas, South Stream, unconventional gas, USA

The geometry of trifocal curves with applications in architecture, urban and spatial planning

In this paper we consider historical genesis of trifocal curve as an optimal curve for solving the Fermat?s problem (minimizing the sum of distance of one point to three given points in the plane). Trifocal curves are basic plane geometric forms which appear in location problems. We also analyze algebraic equation of these curves and some of their applications in architecture, urbanism and spatial planning. The area and perimeter of trifocal curves are calculated using a Java application. The Java applet is developed for determining numerical value for the Fermat-Torricelli-Weber point and optimal curve with three foci, when starting points are given on an urban map. We also present an application of trifocal curves through the analysis of one specific solution in South Stream gas pipeline project.

Azerbaijan is in the TANAP, TAP, and South Stream Project Triangle at the Deadlock of Nabucco

This study has been investigated some pipeline lines after collapsing process of Union of Soviet Socialist Republics from Azerbaijan to Europe and another alternative ways from Russia. As we know Russia is a big power as from economic, defensive, and political aspects, as that’s in ruler position in the region. So, USA from another side of the world as a super power of the world could make dimension of those pipelines from transit of Turkey. That’s why new Nabucco project has been also cancelled by Russia’s power. This article has been studied newly established project of Trans Anatolian Natural Gas Line Project (TANAP) from Azerbaijan’s oil and gas department, Ministry’s State Petroleum Company’s (SOCAR) project has not been cancelled by Turkish Petroleum Company (TPAO). So TANAP’s advantages and disadvantages have been researched in this article.

Crimea's annexation: The blockade of EU's energy diversification strategy in Black Sea basin?

Objective The paper aims to synthesis the impacts of Crimea's annexation into Russia on EU's energy diversification strategy, as well as the natural gas pipelines competitions in the Black Sea basin. Methodology/Technique Based on secondary documentary research method, more than 10 in press articles and journals in the related studies field are found, then synchronizing their findings into comprehensive paragraphs. Findings Firstly, the annexation of Crimea is an additional value to Russia's from the perspectives of economics, and military strength. Secondly, South stream pipeline would remain as one of the biggest competitors for EU after this annexation process; also EU would need to rectify its threat and so to diversify their natural gas market in order to avoid over-dependent on Russian's gas. Finally, Russia in this case would become a dominant gas player after this Crimea's annexation. Novelty : Although there are many studies addressing this topic, most of them just address part of the issue. This paper, based on the latest extensive findings from previous research in press articles, reviews, journals, and case studies, give readers a holistic view of the Crimea's annexation into Russia. Type of Paper: Review Keywords: European Union (EU); Energy Economics; Crimea; Black Sea; Diversification Strategy; Russia; Pipelines; Natural Gas; Geopolitics

Energy products - one of supporting pillars of geopolitical power of Russia

The pillars of the Russian political power are as follows: nuclear power, the United Nations veto power, possession and trade in energy products. In comparison with other countries on the international energy market Russia has enormous energy and mineral resources. It uses them as an instrument of pursuing of its foreign policy and gaining regional and global power. Building of the South Stream enables Russia to expand its power in the Mediterranean, South Europe and in the African pipeline areas. Russia has developed several projects covering a broader Euro-Asian and Mediterranean area. In this way, it has positioned itself for a global energy acting through which it attempts to achieve its aim of exerting its global political influence establishing itself as a global energy super power.

Simulating Security of Supply Effects of the Nabucco and South Stream Projects for the European Natural Gas Market

Because of the decrease in domestic production in Europe, additional natural gas volumes will be required. In addition to Nord Stream, the major import pipeline projects, Nabucco and South Stream, have been announced to provide further gas supplies to Europe. This raises the question concerning whether and how these projects contribute to the European Union’s focus on security of supply. Applying the natural gas infrastructure model TIGER, this paper investigates the impact of these pipeline projects on southeastern Europe’s gas supply. Gas flows and marginal cost prices are evaluated in general and considering the possibility of supply disruptions via Ukraine for the year 2020. The model results show a positive impact of these pipelines on security of supply despite few consumer cut-offs that result from intra-European bottlenecks. South Stream is only highly utilized in case of a Ukraine crisis, supporting the idea that its main purpose is to bypass Ukraine.

Turkey-Russia Energy Relations

As 2OII drew to an end, Turkey took major steps in the ongoing race between rival pipeline projects that seek to supply natural gas to European markets. It first signed a memorandum of understanding with Azerbaijan for the construction of the Trans-Anatolia pipeline that will carry Azerbaijani natural gas to Europe through its territory and means an additional line for its imports from Azerbaijan. Though this unexpected development might thwart specific pipeline projects such as Nabucco, supported by European energy companies, overall, the joint Azerbaijani-Turkish project is likely to contribute to the southern corridor promoted by the EU as a way to bolster its energy security by building alternative natural gas pipelines from the Caspian basin. Only a few days later, Turkey, in an unexpected move, reached an agreement with Russia that will allow the construction of part of Gazprom's ambitious South Stream pipeline in Turkey's territorial waters in the Black Sea. South Stream aims to consolidate Gazprom's dominant position in the European markets and is seen as Gazprom's most lethal weapon to forestall competition from EU-backed projects - and is therefore a rival.In the iggos, in contrast, Turkey largely positioned itself against Russia, when arguably the new great game over the development and transportation of the Caspian basin and central Asian reserves was about to start. Having coordinated its energy policies with the east-west corridor supported by the western powers, Turkey took an active role in projects that aimed to bypass Russian-controlled transportation lines and bolster the economic and political independence of the new states in the region. The rivalry among various oil-and-gas pipelines advocated by the United States and EU on the one hand and Russia on the other continued throughout the last decade. Turkey remained committed to projects backed by western powers but increasingly developed a more cooperative relationship with Russia's rival projects; it also rendered itself dependent on Moscow for its soaring energy needs.The multifaceted energy relations between Turkey and Russia offer a crucial case to study the changing priorities of Turkish foreign policy and the limits of this transformation. Turkey has adopted cooperative policies based on positive-sum logic and downplayed competitive negative-sum calculations. With this new approach to international relations, Turkey seeks to use interdependencies forged through economic exchanges as a tool to dampen political disputes and induce positive transformation in the behaviour of its partners. The transformation of Turkish- Russian relations from adversity to managed competition and the current phase of multidimensional partnership owes a great deal to the economic interdependence imparted most crucially by energy cooperation. Turkey's pursuit of a more independent approach vis-a-vis the west and its forging of closer economic and political relations with its northern neighbour Russia are a testament to the success of its new foreign policy vision, which also values cooperation with its immediate neighbours. As this article will argue, Russia's failure to deliver on Turkey's expectations in both energy and neighbourhood issues exposes the limitations of this new approach. The return to competitive dynamics after the parties reached a historic grand bargain in energy cooperation in 2009 clearly reveals the boundaries of Turkey's positive-sum approach to energy cooperation with Russia.DYNAMICS OF TURKISH-RUSSIAN ENERGY RELATIONS: BETWEEN RIVALRY AND DEPENDENCEEnergy relations between Russia and Turkey exhibit interesting patterns, reflecting Turkey's various roles in energy markets. In recent years, Turkey's energy policies have been based on two interrelated roles as a consumer and as a transportation corridor aspirant. First, since it is a net importer of hydrocarbons, which form a disproportionally major share of its energy mix, Turkey is under constant pressure to ensure access to reliable energy sources at affordable costs. …

Geopolitics of Natural Gas Supply in Europe – Poland between the EU and Russia

The article analyses possible interests, attitudes and activities of the major actors in the ‘natural gas supply game’ in Europe after 1990: Russia/Gazprom, alternative suppliers like countries in the Caspian Sea area, the main consumers of gas and transit countries. It stresses that behaviour of the actors depends on the changing international political and economic situation and conditions in individual countries. Special attention is paid to pipeline projects: Nord Stream, South Stream and Nabucco, and reactions to them, such as building a LGN terminal at Świnoujście (Poland), North-South (Baltic-Adriatic) energy corridor and the Polish-Russian gas contract of 2010.

Impact of Exotic Willow Roots (Salix spp.) as Habitat for Aquatic Invertebrate Communities in South Australian Stream

Impact of Exotic Willow Roots (Salix spp.) as Habitat for Aquatic Invertebrate Communities in South Australian Stream

In the End, It Always Comes Down to the Gas

There are at least three major problems keeping EU–Russia relations focused on natural gas: the pricing mechanism in long-term gas supply contracts, impact of the EU third energy package on the Russian-owned gas assets, and the future (status) of the South Stream project.

Determination of Optimal Parameters of Distributive Gas Pipeline by Dynamic Programming Method

In this article we present a model for determination of optimal parameters of main distributive gas pipelines by dynamic programming (DP) methods. The basic characteristic of this gas pipeline system is that the transported gas quantities are variables. This article presents DP techniques for solving the problem of minimizing investment costs of gas pipeline building. The main objective of this program is to determine the optimal location of compressor station and the optimal diameter of gas pipeline under the constraint of pressure value achievement for all users. The proposed model develops an improved numerical searching technique with the purpose of finding the optimal solution quickly. Applications for this method for optimal parameter determination of gas pipelines and the results are exemplified by the design of a gas pipeline in Belgrade–Valjevo. The model presented will be applied in a feasibility study to define the optimal parameters of a future gas pipeline, South Stream, from the Russian Federation to central Europe.

The EU foreign gas policy of transit corridors: autopsy of the stillborn Nabucco project

AbstractIn this paper, we criticise the departure of the European Union (EU) from its traditional Soft Power vein in foreign energy policy, implying a strategy of gas corridors for import diversification in an intense political competition with Russia. We analyse intrinsic limitations of the EU initiative of promotion of Nabucco pipeline as a merchant line along three different economic perspectives. Firstly, the competition theory perspective which shows the possibility for Russia to challenge this project by a competing project (South Stream) because it could preempt access to Caspian resources. Secondly, the ‘transaction cost economics’ perspective which shows why long‐term commitments between producers and midstream buyers are necessary to jointly develop transport or transit infrastructures and new remote gas fields. Thirdly, the coalition theory perspective which sheds light on the weak cohesion of the Nabucco coalition in the competition with the South Stream coalition, which has more chance of success while it offers equivalent benefits in terms of transit risk suppression. We conclude with recommendations concerning the EU gas policy actions which are only relevant when focusing on better improved market integration, development of self‐insurances and solidarity, and diplomatic action turned towards energy markets integration.

Spawning-related movement patterns of a unique rainbow trout (Oncorhynchus mykiss) population in a South Dakota headwater stream

The objectives of this study were to determine the spawning locations and movement patterns, and provide insight to the success of a naturalized rainbow trout (Oncorhynchus mykiss) population that occurs in a 3 km section of Spearfish Creek, South Dakota. Twelve rainbow trout from Spearfish Creek, South Dakota were implanted with radio transmitters and tracked from 6 December 2006 to 19 June 2007. Initiation of rainbow trout spawning-related movement was correlated with increasing discharge (r = 0.65, p = 0.0009). Mean gross movement was significantly lower during the pre-spawn period (mean = 236 m, SE = 59) compared with the spawning period (mean = 1661 m, SE = 313) (Kruskal–Wallis, F 1,30 = 56.3, p < 0.0001). Mean net movement was 25 m during the pre-spawn period and −9 m (downstream) during spawning. All rainbow trout used in this study moved into Cleopatra Creek (a tributary of Spearfish Creek) during the spawning period even though other nearby tributaries was available. The presence of brown trout (Salmo trutta) in the other tributaries is a possible reason why the rainbow trout did not use those areas for spawning.

The making of empires: Russia's gas-exporting pipelines v Nabucco

Russia’s most recent energy initiatives, the construction of the Nord Stream pipeline across the Baltic and the South Stream pipeline across the Black Sea, have prompted a great deal of questions as to the economic viability of the two ventures and the real intentions behind them. The European Union’s difficulties in bringing to life its Nabucco project, which has been in the works since 2002, shows how difficult building a pipeline several thousands of miles long can be without centralized state support. Even while the international legal regime for overland and underwater pipelines covers much ground, the complexities and spy-novel-like intrigues surrounding the implementation of Europe’s rival pipeline systems cannot be adequately accounted for under the existing framework. The objective of this article is to analyse the different political and legal controversies surrounding the construction of gas pipelines in Europe.