TUESDAY, NOVEMBER 24, 2020 (10:00 - 12:00 EET)
THE NEW GAS FLOWS OF SOUTHEAST EUROPE: BETWEEN GEOPOLITICS AND A NEW MARKET REALITY
A new dynamics of gas flows is starting to develop in SEE, with Russia redirecting a part of the gas transit through Ukraine via the recently inaugurated TurkStream. The upcoming second line, due to reach Hungary via Bulgaria and Serbia, opens the prospect for new markets in the Balkans, as well as competition among new pipeline projects, vying to tap into fresh gas flows. The Southern Gas Corridor will also cross the region, and new LNG terminals are to be built in Greece and Croatia. A Vertical Corridor of gas is planned to connect Greece to Bulgaria, Romania, Hungary, and further on to the Baltic Sea. The US-backed Three Seas Initiative will play an important role as well.
A new regional competition for pipelines, interconnectors, transit fees, market volumes, and political influence is likely to start, under redoubled constraints of EU gas market rules and regulations, as well as new restrictions for access to financing gas infrastructure.
On the other hand, the upstream sector has been upended by an oversupplied European gas market, with depressed prices – an effect exacerbated by the Covid-19 crisis. Under these circumstances, projects such as Neptun Deep promptly require significantly improved regulatory terms. For the FIDs in the Black Sea fields, 2020 may well be a last train. Meanwhile, Romania’s offshore wind potential has got into the limelight.
On the longer run, the projections of diminishing gas demand in Europe, the increasing electrification of final energy consumption and the promotion by the European Commission of a value chain (production, transport, and demand) for renewable hydrogen, possibly on the back of offshore wind power creates both opportunities for synergy and sector integration, and complexity and uncertainty which must be address by means of smart regulations.
MODERATED DIALOGUE BETWEEN:
Oxford Institute of Energy Studies (OIES)
CEO, OMV Petrom
Senior Visiting Research Fellow, OIES
CEO Transgaz, Romania
CEO, FGSZ, Hungary