Russia-Ukraine gas dispute leaves Slovakia unruffled

ALTHOUGH the recent gas dispute between Russia and Ukraine has not seriously affected Slovakia, the temporary cut in natural gas supplies from Russia has reopened debate on Slovakia's energy policy, especially its dependence on Russian gas. Supplies of Russian natural gas to Slovakia fell by 30 percent on January 2, but returned to normal levels the next day.

The Russian gas company Gazprom stopped deliveries of gas to Ukraine on January 1 because of a dispute in which Moscow has accused Kiev of stealing gas from Gazprom's pipelines on its territory. Ukraine had previously rejected a fourfold increase in gas prices proposed by Russian President Vladimir Putin.

About 80 per cent of the gas Gazprom sells to other European countries goes through Ukraine, although few of them are as wholly dependent on Russian gas as Slovakia.

Gazprom has been at pains to reassure Western customers that it is not using energy as a political weapon, and on January 3 it sent an extra 100 million cubic meters of gas through Slovakia's pipelines to compensate for the previous day's shortage.

The temporary shortfall had forced Slovak gas utility Slovenský plynárenský priemysel (SPP) to draw from its underground storage tanks in the Záhorie region of Western Slovakia, but on January 3 Philippe Boucly, chairman of the SPP Board of Directors, confirmed that gas supplies to Slovakia were again at standard levels.

"SPP is receiving the agreed-upon amount of gas at the moment," Boucly said.

Slovak officials stressed that the dispute was unlikely to seriously threaten Slovak energy supplies, and Economy Minister Jirko Malchárek called a special meeting to review the situation.

"After careful consideration of the situation between Ukraine and Russia, there is no real risk of a natural gas shortage in Slovakia. SPP has sufficient gas reserves to cover Slovakia's needs in case of crisis. Slovak-Russian relations are also extraordinarily good after Minister Malchárek's last visit [to Russia]," Economy Ministry spokesman Róbert Beňo told The Slovak Spectator.

"A short-term shortage of 30 percent of daily gas supplies from Russia cannot possibly have any impact on gas prices," Beňo added.

Malchárek also downplayed the threat of an energy crisis. "All speculation concerning a possible reduction in gas supplies to Slovak businesses and households is just that - speculation," the minister said.

SPP spokeswoman Dana Kršáková assured the company's clients they would feel no impact from the cut, and noted that Slovakia had signed an agreement on gas supplies directly with Russia, meaning that even if gas supplies to Ukraine were cut permanently, it should have no impact on Slovakia.

In line with EU requirements, Slovakia's gas reserves represent around 30 percent of the country's annual gas consumption, or 2 billion cubic metres of natural gas. SPP also has access to gas at a storage facility in Dolné Bojanovce in the Czech Republic.

As the gas dispute culminated, Malchárek called on Slovakia's Visegrad Four counterparts (Hungary, Poland and the Czech Republic) to take a common stance in pressing Russia and Ukraine to reach agreement.

The Economy Ministry's Beňo said that Malchárek has been in contact with his partners and would consider any proposals that might benefit Slovakia.

"We'll have to see what proposals they submit. All the other V4 countries are strategically in a worse position than Slovakia, although the Czechs have the option to import Norwegian gas, as does Slovakia."

While the gas dispute has ended well for Slovakia, questions have been raised as to whether gas cuts could turn former Soviet satellites like Slovakia into economic hostages to Russia.

Slovakia has recently been revising a 1999 document outlining the country's energy strategies with the aim of reducing Slovakia's dependence on imported energy.

Currently, annual consumption of natural gas in Slovakia stands at seven billion cubic metres. Analysts forecast that by 2013 consumption could rise to nine billion cubic metres, with Slovakia remaining dependent on imports from Russia.

Slovakia imports 90 percent of its primary energy sources.

However, the Economy Ministry believes the recent gas dispute will not have a direct impact on the energy strategy.

"The diversification of energy sources is not currently an issue. The cabinet has been dealing with it as part of a draft energy policy that ministers should discuss soon," Beňo said.

"Slovakia's energy policies do not depend on relations between Russia and Ukraine. We have pretty well balanced energy sources, and we are considering nuclear power plant construction and strengthening alternative energy sources," Beňo told the Spectator.