Russ Oil-Gas

30.05.2006 MosNews - On Monday, May 29, Alexander Medvedev, Gazprom's deputy chief executive, has rejected European Union demands that Russia's state-controlled gas monopoly open its pipeline network to independent producers and other countries. He also called plans to bypass Russia with a gas pipeline from Kazakhstan to Europe "unrealistic". The planned trans-Caspian pipeline has strong backing from the EU, which is seeking ways to loosen Russia's stranglehold on gas supplies from Central Asia. U.S. vice president Dick Cheney recently met the Kazakh President Nursultan Nazarbaev to push for the project. However, Medvedev said Kazakhstan did not have enough gas to justify the planned pipeline, nor Europe enough demand. "I'm rather sure that without Russian gas, no projects in new supply will fly," he said, quoted by the Financial Times. "Today, due to the absence for the additional markets for this gas in Europe, it is absolutely unrealistic." The EU gets a quarter of its gas from Russia, the country with the biggest reserves in the world. However, fears over its reliability as a supplier were prompted by an interruption on January 1 after a spat with Ukraine over gas prices. Gazprom's chief executive, Alexei Miller, deepened concerns by warning EU ambassadors that if monopoly's plans to expand to the European downstream market were thwarted, Gazprom would respond by shifting its investment focus to new markets in Asia. At a recent pro-democracy convention in Lithuania Cheney warned Russia against using its vast energy reserves to "blackmail" neighbors. Medvedev said Gazprom had been unfairly portrayed and hit out at Cheney. "When Mr. Cheney is saying that Russia is using blackmail [as a] negotiating technique, that is nothing to do with our normal business practice," he said. "I believe that Russia didn't use gas supplies as a weapon, and didn't blackmail anybody. We have done our utmost to secure transit routes through Ukraine." Russia will host a meeting of the Group of Eight industrialized nations in July to discuss energy security.