BALKANS AMONG MOST THREATENED BY POSSIBLE GAS CRISIS

Although the winter heating season is yet to show any disruption and Ukraine and Russia have come to an interim arrangement on gas supplies, risks remains for a potential break in Russian gas supplies. 

An earlier European Commission analysis of the consequences of gas supply stoppage, indicated they this would hit eastern EU members and the Balkan countries that are part of the Energy Community the most. The analysis presented two scenarios, one of which refers to the complete halt of Russian gas imports to the EU and Energy Community member countries, while the other pertains to the suspension of supply via Ukraine in the fall-winter period, with projections for one month and six months of crisis.

The most jeopardized countries in that case would be Bulgaria, Romania, Serbia, Macedonia, and Bosnia and Herzegovina, which might at the end of the six-month crisis period face an inflow of gas reduced by 40 percent or more. A very similar scenario would face Lithuania, Estonia and Finland, if the inflow of Russian gas stopped completely, whereas Hungary and Poland would be a little less affected, as they would experience gas shortages of 30, i.e. 20 percent.

According to the European Commission’s analysis, the situation could be somewhat better if the countries linked by gas interconnections cooperated efficiently. That particularly applies if a long-term supply crisis diminishes the gas reserves the endangered countries have at their disposal. The Commission also says that Serbia and Bosnia, despite the fact that a third of heating plants in the two countries can switch from gas to oil, do not have sufficient oil reserves.

The Commission has thereby called for the faster building of infrastructure connecting the countries, such as the gas interconnectors between Serbia, Bulgaria, Greece, Romania, and Moldova.

The Balkan countries remember well the gas crisis of 2009-2010, when they were forced to shut down their industries and put remote household heating in question, over the gas war between Russia and Ukraine.

BH Gas, Bosnia’s gas distributor, has said it is cooperating excellently with Russian Gazprom, but that in case of reduction or suspension of gas deliveries it will immediately activate cooperation with German EON Ruhrgas. “Our business mission is to enable gas deliveries from various sources, and we are continuously working on a project of attaching to the Ionian Adriatic Pipeline, which is an extension of the Trans Adriatic Pipeline starting from Azerbaijan,” BH Gas representatives said.

Companies in Bosnia and Herzegovina are also preparing for a potential crisis. Dijana Bozic-Srdanovic, spokeswoman of ArcelorMittal Zenica, said that a joint working group has been formed with BH Gas in order to prepare for a possible halt in gas deliveries from Ukraine to Europe. “If something like that happens, it would not affect the majority of operations in our facilities over a period of ten days or so, but could have a certain effect on the making of end products, i.e. on the Valjaonica rolling mill. We also have certain gas reserves and are working on alternative options, together with BH Gas,“ said Bozic-Srdanovic.

However, BH Gas itself owes a certain amount to the Russian partners. Company officials said BH Gas’ debt to Gazprom totals roughly eight million dollars, which puts an additional strain on Bosnia ahead of the heating season.

The situation is similar in Serbia, where, like in Bosnia, there is no reliable alternative gas supply source.

“Serbia is most definitely endangered by the potential halt in gas supplies from Russia. Due to somewhat fuller gas storage facilities, the crisis might be a little less serious than in 2009, but only if the reduction of deliveries does not last long. That is why Serbia must work on alternative gas supply routes, but the question is when that can be done due to the difficult economic situation in Serbia,” Belgrade Economics Institute associate Mahmut Busatlija told Natural Gas Europe.

However, Srbijagas (Serbia’s gas distributor) CEO Dusan Bajatovic said that Serbia had enough fuel for the winter, even in the event of a gas crisis. According to him, there are gas reserves for 90 days, after which a fuel oil substitute can be utilized. “Serbia can safely go through the winter period even in the event of gas crisis over Ukraine,” he said.

But some in Serbia are more cautious. Deputy Prime Minister Zorana Mihajlovic said the country was also struck by disastrous floods in May, which jeopardized the stability of the Electric Power Industry of Serbia, and that the country is not secure in the gas, oil and electricity sector in the long term. “Serbia has not built a new power plant in three decades,” said Mihajlovic, adding that the construction of a gas interconnection to the Bulgarian town of Dimitrovgrad would have to be one of the state’s infrastructure priorities.

However, different warnings have come from the EU as well. Czech Minister of Industry and Trade Jan Mladek has urged the EU to swiftly solve the problems surrounding Russian gas deliveries, as a repeat of the 2009 gas crisis would be a “humanitarian threat” for the Balkans. “The risk of a humanitarian disaster and frozen people in the Balkans is real,” said Mladek and called on the EU to resolve the situation regarding gas deliveries to Europe right immediately

All countries in the region had hopes that the South Stream pipeline would increase their energy stability. But, Russian President Vladimir Putin said in Ankara on Dec 1 that his country was forced to withdraw from the South Stream project over the European Union's refusal to support the building of the pipeline. Serbian Prime Minister Aleksandar Vucic stated on Dec. 2 that Russia's giving up on the construction of the South Stream gas pipeline is bad news for Serbia, but added that the citizens should not worry about the supply of gas.

Igor Jovanovic in Belgrade