EC seeks to set up pan-European energy community: Lamoureux

Brussels (Platts)--26Apr2005

The European Commission plans to look at setting up a pan-European energy
community, including Russia and Ukraine, its energy director general, Francois
Lamoureux, said Tuesday. He told the European Parliament energy committee that
the European Union and Russia's successful energy dialogue over the last five
years was being considered as a model for talks with other countries. "The
dialogue allowed us to get Russia to understand the EU internal energy market
and the importance of respecting its rules," Lamoureux said. For example,
through the dialogue the EU persuaded Russian gas company Gazprom to drop
destination clauses in its long-term supply contracts with EU member states.
"But our interdependency with Russia in areas such as competition, research
and investment guarantees leads us to believe that we will have to think about
a more institutionalized form for future talks." The idea for a pan-European
energy community had been mooted by politicians since the 1990s, said
Lamoureux, including by the last EC president, Romano Prodi.

Lamoureux said that the EC still supported the Energy Charter Treaty--the
international agreement which seeks to set legally binding rules for energy
cooperation between signatories. "It is simply a political reality that Russia
is not going to want to ratify it--and without Russia the ECT won't work," he
said. "We're trying to see what kind of institutional structure between Russia
and the EU would work. It would also make sense to bring in Ukraine as well as
other consumer countries like the EU." The aim would be to find some way to
get countries to observe at least part of the ECT rules, even if they won't
adopt the entire treaty. The ECT promotes protecting foreign investment, free
trade based on World Trade Organization rules, freedom of transit, energy
efficiency and mechanisms to resolve disputes both between countries and
between investors and countries.

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