Pipeline projects in the spectrum of interest of states

The geo-political dimension in the Euro-Atlantic region

Heinz Brill

According to the understanding of the former president of the Federal Academy for Security Policy, Admiral Dieter Wellersdorf, „the most important prerequisite for the central preparing of decisions in security policy is the holistic understanding of security policy with executive elites“. Not new, but increasingly added to the classic security risks is the problem of inter- and/or transcontinental „energy security“ provided by „gas pipelines“ and their transit for the European market. Especially since Russia and Ukraine have quarreled about gas prices, and the EU has looked for realistic alternatives, trans-continental gas pipelines determine both national and international discussions. Natural gas is a fossil energy carrier and is becoming increasingly relevant for international power supply. It is considered the bridge into the era of sustainable energies. Gas-fired power plants produce about 50% less CO2 than coal-fired power plants. The natural gas market – in most parts of the world – is in transition from a long-term contract, natural-monopoly utility market to a much shorter-term competitive energy commodity market. These important structural changes are being driven by government policy rather than the gas industry itself. In recent years they have been spreading to Continental Europe with the implementation of the EU Electricity and Gas Directives. As a result, natural gas prices are now being determined in the short term by over-the-counter (OTC) trading and futures exchanges rather than by formulas linked to the price of oil or other competing fuels – but the link to oil still remains in many long-term contracts, upstream joint production and downstream inter-fuel competition, especially in power generation. It is estimated that the Arctic could hold about 13% of the world’s undiscovered oil reserves and as much as 30% of the world’s undiscovered natural gas reserves. Allocating the estimated resources/provinces to the nearest country (with „shared“ provinces allocated equally), Russia is estimated to hold more than half of the total Arctic resources. Russia also holds the largest amount of natural gas resources, while the largest oil resources are in the US portion of the Arctic (Alaska). The USA, the largest gas producer, accounted for over half of the 2019 global increase, followed by Russia, Australia, China and Iran. US domestic gas production rose by more than 10%, triggered by new developments in shale formations in Texas and in Pennsylvania. The current stage in international relations is characterized by rapid intensification of competition in the energy sphere. Turkey’s unique geopolitical situation derives from the fact that it is poor in hydrocarbon reserves while its neighborhood has abundant resources. This provides an imperative for Ankara to pursue stable energy ties with energy-rich countries or regions in its proximity. In line with Turkey’s ever-growing domestic demand, energy security-driven endeavors have become integral to the country’s foreign policy in the past two decades. The pursuit of hydrocarbons, especially natural gas, has become a key geopolitical and geo-economic goal for the country. This article looks at the ways to diversify gas deliveries to Europe, the geopolitical consequences of and Europe’s reaction to implementation of the Turkish Stream gas pipeline, and Turkey becoming the largest transit country and most important gas hub for Europe. How political natural gas trading has always been is shown by the „interplay“ of mining, transit and consumer states, including the interests of the world and great powers, likewise in the past and present time. In order to supply the needs of natural gas in the EU, apart from exploiting new sources of supply, alternative means of transport are required. In this aspect, „liquid natural gas“, or LNG, offers an essential supplement to the pipeline projects. In order to avoid unbalanced dependency, a mix of energies has come into focus. Thus, the guideline and/or the strategic goal of the EU is power generation by the variety of possibilities.