Pipeliners

25/08/2005 MOSCOW (Alexei Makarkin for RIA Novosti.)- Growing competition in the post-Soviet territory proclaims itself, above all, during high-level political events. This was demonstrated during the recent summit in Artek attended by the presidents of Ukraine, Georgia, Poland and Lithuania who announced plans for a Baltic-Caspian-Black Sea union. Clearly, it aims to create an alternative center of influence in the former USSR supported by Poland's ambitions to be an informal leader of the new members of "united Europe." Participants in this emerging bloc of CIS countries (Ukraine in the first place) hope to establish positive relations with the EU, which may in the distant future help them achieve their cherished dream - integration into Europe. The authors of the project, encouraged by the "color" revolutions, ooze optimism. But things are not that simple - accompanying political factors there is an economic factor and a big one, Russia's critical role as a gas exporter to the Old World. This role does not depend on the political climate: gas was pumped in the Soviet era, in the tumultuous 90s and is pumped now. While the leaders of the four countries, without inviting their Russian colleague, met in Artek, construction of the North-European gas pipeline (NEP) was begun. The first hundred kilometers across the Leningrad region will be laid within the next six months. In the second quarter of 2006, Gazprom plans to put into operation the first section of the line stretching 140km and passing through the Vologda and Leningrad regions. Later it is planned to extend the pipeline to the German city of Greifswald via the bottom of the Baltic Sea. The project is expected to go on line in 2010. The political undertones of the project are obvious. By sending gas directly to Europe and bypassing the transit countries Russia could cause serious economic problems for Ukraine and Poland. Ukraine and Russia often argue over the gas issue. Currently, the advantages of being a transit state allow Ukrainian to avoid serious troubles. Now the situation could be radically altered - even in the interim Russia may find an attractive alternative to the Ukrainian route. The project would have remained on paper if large German companies had not shown interest. In April, Wingaz, a subsidiary jointly owned by Gazprom and the German concern BASF, agreed to join the venture. Serious discussions are now under way with Ruhrgas, Gazprom's traditional partner. Big international banks have stepped forward with credits for pipeline construction. European public opinion sympathizes with Ukraine's "Orange Revolution" and supports Poland in its wranglings with Russia. But business interests are dictating German (and not only German) companies to optimize gas cooperation with Russia. Poland currently is pinning hopes on governmental change in Berlin - while Gerhard Schroeder is known as a champion of an alliance with Russia, his most probable successor - Angela Merkel - is more inclined to side with Washington and Warsaw (which she visited during her election campaign). German companies are known to heed government views: this fact appears to have played a role in the case of the NEP, which Schroeder approves. But in Germany, as elsewhere, we also see the opposite tendency: the government cannot help dealing with the business community. The CDU is traditionally seen as a party closer to big business than the SDP in Germany. So if the right-of-center forces have election success, the pipeline project may be continued. What will be the response of the transit countries to the Russian-German project? Political leaders hastily dusted off old plans to build a gas pipeline from Turkmenistan bypassing Russia, put forth five years ago by Yuliya Timoshenko (then as a vice-premier). Now she has agreed with Gaz de France to cooperate on this project - with gas deliveries planned from both Turkmenistan and Iran. But while the North European pipeline is already a going concern, Kiev's planned alternative is still vaguely worded in protocols of intent. Moreover, the gas partnership between Ukraine and Turkmenistan is far from thriving (the Turkmen leader publicly accused his Kiev partners of abuses) and to consider projects involving both Europeans and Iran in the politically tense present situation does not appear possible. So the "southern" alternative to the North-European line looks very doubtful. This means Russia now has a good "pipeline" argument in big political chess game concerning the Eurasian territory. Alexei Makarkin is deputy director of the Center for Political Technologies