Move to Separate Pipelines From Production Opposed by Energy Council, Gas Lobby

3/16/2012 10:39 AM
Category: Politics

With the probability high that Eesti Gaas will be required to divest its pipelines, pressure is increasing on lawmakers to oppose the move, which is required by EU law but is unpopular with the gas company's 37 percent Russian owner and main supplier.

Parliament will discuss the planned separation of gas pipeline infrastructure from production and sales on March 21, after the Economic Affairs Committee approved the text of the amendments to the Natural Gas Act and the Code of Economic Activities on March 15.

The progress on the amendments prompted the Academy of Sciences energy council, whose chairman Arvi Hamburg is also adviser to Eesti Gaas, to send a letter to the Parliament that some see as a veiled ultimatum from Gazprom as well as the other two foreign owners, the Finnish Fortum and the German E.ON.

"A unilateral decision not based on analysis may worsen the reliability of supply for Estonian consumers, sowing possible obstacles in use of Latvia's underground gas depository and establishing international (including to the Russian Federation) connections," read the letter.

Chairman of the Economic Affairs Committee Arto Aas called it a "very serious threat to Estonian energy security and a fairly unprecedented influencing of legislators."

Under the law, the monopoly Eesti Gaas must sell off its transmission pipes by January 1, 2015, to a company not controlled by gas producers or sellers.

"Estonia's gas consumption currently depends totally on gas of Russian origin," said Aas. "Considering the close to 50 percent share of gas in heat production, it is in the interests of security and free competition to increase reliability fo supply and creation of alternative supply sources."

Kristopher Rikken

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