The EU’s worst nightmare…Turkey, Greece and Russia controlling the energy flow into Europe

Post originally appeared on Russia Insider.

Greece favors the Turkish Stream project to boost its chances of becoming a gas hub for Southeast Europe, said Marco Giuli, a policy analyst from the Brussels-based European Policy Centre on Monday.

His comments come as Greek Energy Minister Panagiotis Lafazanis meets his Russian counterpart Alexander Novak and the CEO of Russian energy giant Gazprom on Monday in Moscow.

“Greece needs foreign investors to complete the necessary interconnections that will allow Athens to play this role. As such, it is looking to Russia as well as to other partners,” Giuli said.

According to experts, in the upcoming meeting a gas discount for Greece could be discussed.

“Gazprom is expected to offer a discount to Greece in exchange for a contractual extension. This could be instrumental in the well-known divide-and-rule strategy of Russia in energy matters. This is not a Greek-specific issue, as every EU member state negotiates separately with Gazprom, often obtaining similar advantages,” Giuli said.

Giuli added that regulatory developments in the EU have significantly impacted and curbed Gazprom’s power – although not necessarily providing viable alternatives to many eastern EU countries.

After Lafazanis’ visit, Greek Prime Minister Alexis Tsipras will visit Moscow on April 8 as the Turkish Stream is a very significant project for Greece – a sentiment which has been voiced in several statements by Russian officials. The pipeline will allow Russian gas to go through Turkey, which will then be transported to the Greek-Turkish border for further transmission into Europe.

“As you surely know they will probably discuss the prospect of the Turkish Stream gas pipeline entering EU territory at the Greek border, and they will possibly discuss other trade issues also,” said Ingmar Oldberg, an expert from the Swedish Institute of International Affairs.

“Depending on the outcome of the Greek-EU financial negotiations, talks on the possibility of loans to Greece and access of Greek assets like harbors will take place. Greece may use these meetings with Russian leaders as a means of obtaining more favors from the EU and Russia,” Oldberg said, adding that Russia will show its strength against the EU and the sanctions it imposed on the country.

The Turkish Stream project is intended to carry 63 billion cubic meters of natural gas annually and construction is aimed to begin before the end of 2016.

The project is intended to replace the previously planned South Stream pipeline project, which was to carry natural gas to Europe via the Balkan region.

The South Stream project was cancelled due to objections from the EU over its construction, according to Russian President Vladimir Putin.

In December, Putin scrapped the South Stream natural gas pipeline project intended to pass through Bulgaria to Europe, and announced a new natural gas pipeline route through Turkey’s northwestern Thrace region.

Putin also announced that a natural gas hub on the Turkish-Greek border would be constructed.

Taner Yildiz, Turkey’s energy and natural resources minister said earlier in March that Turkey agreed with the Russian delegation in principle that both will take steps for the new gas route through Turkey, instead of having non-binding agreements.


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What happens if Athens comes up short with its April 9 IMF payment?

Back up plan? Greece is looking at nationalising it’s banking system and introducing the New Drachma