Spain, France Call For EU Plan To Guarantee Energy Supply

Mar 13, 2006

The prime ministers of Spain and France -both fending off foreign takeover bids in the energy area -called Monday on the E.U. to come up with a policy to guarantee supplies in that sector.

"Given the challenges of the post-petroleum world, we have to provide answers. Europe has to come up with a true strategy to guarantee energy security," French premier Dominique de Villepin said after talks with his Spanish counterpart, Jose Luis Rodriguez Zapatero.

They said they also had discussed the fight against terrorism and the crisis over Iran's nuclear program.

Both denied that they were being protectionist - Zapatero for his opposition to German E.On AG's (EOA.XE) bid to buy Spanish utility Endesa SA (ELE), and de Villepin for plans to merge state-owned Gaz de France (1020848.FR) with Suez SA (12052.FR) to fend off a possible overture from Italy's Enel SpA (EN).

The French leader cited the European aviation consortium Airbus as a good example of Europeans joining together to compete, in this case against Boeing Co (BA) of the U.S.

"Why can't we concentrate more and advance in the energy sector along these lines?" he said.

He said it was a priority for "Europe to create big energy groups capable of defending themselves" on the international stage.

Zapatero said he was not trying to exclude other countries from investing in the Spanish energy sector, alluding to the E.On AG's bid for Endesa, an offer that follows one from Spain's Gas Natural for the same utility.

Zapatero said Spain was highly dependent on other countries for its energy, and simply had to protect its own interests by creating a national energy champion.

"Spain has demonstrated that it is a country open to foreign investment. This is not about being open or closed, about protectionism or not being protectionist. This has to do with energy security," he said.

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