By Gabriele Steinhauser
BRUSSELS--European Union leaders said Thursday they would move
to break down barriers in the bloc's energy market and endorsed
stronger regulation of national gas-supply contracts, most notably
with Russia.
The EU gets around one-third of its natural gas from Russia,
with several countries relying almost exclusively on shipments from
state-owned gas company OAO Gazprom. The standoff in Ukraine has
renewed concerns over gas cutoffs, as happened most recently in
2009, and the diplomatic vulnerabilities created by such
dependence. This winter, Russia reduced deliveries to Slovakia by
more than half after the country began shipping gas to Ukraine.
At a summit Thursday, leaders said they would work on
constructing a so-called energy union, which would allow
electricity and gas to flow freely across the 28-country bloc. The
European Commission, the EU's executive, has said some of Gazprom's
current contracts in Europe are restricting the sale of unused gas
to other countries and at times charge unfair prices.
Gazprom couldn't be immediately reached for comment.
"An effective energy union can fundamentally improve the
situation in Europe by ensuring cheap, sustainable and secure
energy for all states, companies and citizens," said European
Council President Donald Tusk, who presided over Thursday's
discussion.
To get a better picture of Gazprom's dealings in the bloc, EU
leaders on Thursday asked the commission to strengthen transparency
requirements for gas deals with suppliers outside the bloc--despite
initial resistance from Germany, Hungary and others. Hungary just
last month updated its agreement with Russia, a move that,
according to Prime Minister Viktor Orban, gave it a better price
and better supply terms.
More divisive in discussions ahead of the summit were rules that
would also force private companies to share more information on
their contracts with Gazprom and other gas suppliers. But Germany,
the Netherlands and Finland dropped their objections after getting
assurances that commercially sensitive information would remain
confidential.
EU officials have said that instead of creating a strong role
for the commission for overseeing such contracts--as had been
foreseen initially--the bloc could strengthen the powers of
national energy regulators and require them to share more
information among each other. The commission plans to propose new
legislation on the contracts next year; it would then still require
signoff from national energy ministers and the European
Parliament.
EU leaders also pledged to build new links to transport both gas
and electricity across national borders--both to improve security
of supply and even out bottlenecks in times of high consumption in
one place and overproduction in another.
On Friday, the EU hopes to tackle a more acute supply threat,
kicking off another round of talks between Russia and Ukraine on
gas shipments beyond March. An EU-mediated deal on gas supplies
over the winter expires at the end of the month, raising questions
over how Ukraine will be able to fill up its large underground
storage facilities over the spring and summer.
According to the commission, Ukraine needs at least 19 billion
cubic meters of gas in storage by October, to make sure there is
enough for its own consumption and ensure efficient transit to the
EU. Ukraine is reluctant to buy gas from Russia, especially if
Moscow doesn't further cut prices, and the commission fears that
reverse flows from Slovakia, Hungary and Poland won't be enough to
fill up the storage.
Ukraine's energy minister said Thursday that he doesn't expect a
resolution Friday. "Russia doesn't want to sign any specific
document," Volodymyr Demchyshyn said in an interview. He also said
that Ukraine wants to almost double the price Gazprom currently
pays to ship gas to the EU through the country's ample pipeline
network--a demand that will likely rile both Brussels and
Moscow.
Sean Carney contributed to this article.
Write to Gabriele Steinhauser at
gabriele.steinhauser@wsj.com
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