Just got this one from Neil Barnett in the Spectator:
How, then, can Europe meet its growing energy needs without inhaling more deeply from Siberia’s vast gas reservoirs? Perhaps surprisingly, the EU has a practical role to play. First, in order to deny Russia a day-to-day blackmail tool, better gas storage and interconnection is required. This might not sound terribly exciting, but it would mean that European states would maintain substantial reserves as a buffer, and be able to share them across borders.
According to Lajos Alacs of the Hungarian energy company MOL: ‘EU countries are obliged to keep 90 days’ strategic reserves of petroleum products, and with refinery stocks and so on there is considerably more, which also allows sharing of risk with neighbours. Hungary decided to create a comparable gas reserve. When it’s finished, we will have 1.2 billion cubic metres, enough to pump 20 million cubic metres for 45 days [around a quarter of demand on a cold day]. Combined with consumption savings, domestic production and other reserves, this will allow us to meet domestic winter demand for some time.’
‘Eastern Europe currently only has east-west connections,’ Alacs adds, ‘and new supply projects [South Stream, Nordstream and Nabucco] are no different. We need north-south connectors, which again will improve our negotiating position. The question is, who would finance this?’