Russia Update: Greece Condemns West for Rejecting Russia’s Turkish Stream as It Defaults

July 1, 2015
Panaiotis Lafazanis, Greece's minister of industrial reform, environment and energy, speaking on Rossiya 24 on June 30, 2015.

Russia may not do more than provide political support, but already Greece has indicated how it will help Russia: pushing for the new Turkish Stream pipeline and condemning the West for “torpedoing” it

Welcome to our column, Russia Update, where we will be closely following day-to-day developments in Russia, including the Russian government’s foreign and domestic policies.

The previous issue is here.

Special features:

‘I Was on Active Duty’: Interview with Captured GRU Officer Aleksandrov
Meet The Russian Fighters Building A Base Between Mariupol And Donetsk
‘There Was No Buk in Our Field’
With Cash and Conspiracy Theories, Russian Orthodox Philanthropist Malofeyev is Useful to the Kremlin

Russia This Week:

Is ‘Novorossiya’ Really Dead?
From Medal of Valor to Ubiquitous Propaganda Symbol: the History of the St. George Ribbon
What Happened to the Slow-Moving Coup?
Can We Be Satisfied with the Theory That Kadyrov Killed Nemtsov?
All the Strange Things Going On in Moscow

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After Missing Deadline, Turkey and Russia May Finalize A Gas Deal By Mid-July

Earlier today we reported that Ukraine and Russia have been unable to reach a deal on the price of natural gas. Ukraine has since said that they will not buy Russian natural gas, and Russia has vowed not to sell it until a price can be negotiated:

Earlier Business Insider reported that this was not the only gas deal to fall through:

Russia’s Gazprom and Turkey’s BOTAŞ had a six-month period to agree on the prices for gas supplies. That time frame expired on Monday without a deal.

“The dispute over prices means there’s no immediate prospect of signing a binding pact for the new pipeline … An agreement could now be delayed until at least October,” people familiar with the situation told Bloomberg.

Now, however, Reuters is reporting that a deal may be finalized by the middle of July:

Turkey and Russia’s Gazprom are likely to finalise a deal on natural gas prices by mid-July, Turkish officials told Reuters, after Ankara warned last week it could seek international arbitration if they failed to agree.

Russia, which supplies more than half the gas consumed by Turkey annually, has already agreed to cut prices by 10.25 percent, but Gazprom’s additional demands regarding the Turkish Stream natural gas project are delaying the final signature, a Turkish energy official said.

In related news, Greece has also wanted to see a new pipeline built, Turkish Stream, which would see Russian natural gas travel through Turkey, Greece, and on to Europe, but the plan has been blocked thus far by the European Union. See our previous report here:

James Miller
Russia To Sign $2 Billion LNG Deal With Pakistan As Two Countries Deepen Military Ties

Pakistan has signed a $2 billion, no bid deal with Russia to construct a liquified natural-gas (LNG) pipeline that runs from Karachi to Lahore. Economic Times reports:

Under the partnership, Russia will provide $2 billion to lay a 1,100-km pipeline from Karachi to Lahore for supplying LNG that will be imported from Qatar and other countries. Pakistan will award the contract to Russia without inviting bids.

It is the first major economic cooperation deal since the 1970s when former Soviet Union helped to set up a steel mill in Karachi and also supported Oil and Gas Development Company.

Relations between the two countries are improving after 40-year of hostility during the Cold War in which Pakistan was in the anti-Soviet Union camp and had been instrumental in the Soviet pullout from Afghanistan in 1980s.

Energy-starved Pakistan likely to sign $2 billion pipeline deal with Russia – The Economic Times

ISLAMABAD: Energy-starved Pakistan is likely to sign a $2 billion deal with Russia for laying a Liquefied Natural Gas (LNG) pipeline from Karachi to Lahore, a sign of increasing ties between the Cold War-era adversaries. The deal is expected to be signed next month during Prime Minister Nawaz Sharif's visit to Moscow to attend a summit of the Shanghai Cooperation Organisation (SCO).

View full page >

Jul 01, 2015 23:11 (GMT)

The plan comes just weeks after Pakistan’s army chief General Raheel Sharif visited Russia. The two countries are scheduled to hold their first-ever joint military drills, and after recent talks Russia announced that talks were under way for the Russian arms exporter Rosoboronexport to sell four four Mil Mi-35M (Hind E) helicopters to Pakistan.

Russia ready to sell four Mi-35M combat helicopters to Pakistan – source

ITAR-TASS/Tina Shaposhnikova MOSCOW, June 17. /TASS/. Russia has sent Pakistan a draft contract on the delivery of four Mil Mi-35M (NATO reporting name: Hind E) combat helicopters, a source in the Russian system of military and technical cooperation said on Wednesday.

View full page >

Jul 01, 2015 23:16 (GMT)

The Russian state news agency Voice of America reported on recent cooperation between the two countries.

“In the last two years, we have had more high level visits between the two countries than in the past many years,” Tariq Fatemi, Pakistan’s minister of state for foreign affairs said in a policy speech.

“These have included ministers of power, energy, petroleum, finance, defense, foreign affairs, the army chief, and the chiefs of the other services,” Fatemi added

James Miller

What Russia Can Learn From Armenia’s Protests
Rogozin Seeks Change In Law, Allowing Those Born After 1991 In Transnistria To Claim Russian Citizenship

Interfax reports that Dmitry Rogozin, the Russian deputy prime minister, has announced his intention to call on the State Duma to amend the law on Russian citizenship so as to allow residents born after 1991 in the unrecognised, breakaway Transnistrian republic in Moldova to claim Russian citizenship.

According to Rogozin, who is known for his nationalism and provocative stunts and declarations, the lack of such a provision in Russian citizenship law forces Transnistrians to seek Moldovan, Romanian, Polish or Bulgarian citizenship.

Rogozin noted that there are around 200 Russian citizens in Transnistria.

“We believe that this situation is wrong.

We have now recommenced work at our consular exit point, which operates in Tiraspol and conducts passport exchanges.”

— Pierre Vaux

Greece Condemns West for Rejecting Russia’s Turkish Stream as It Defaults on IMF Loan

Today Greece defaulted on its €1.5 billion debt repayment, becoming the first developed economy ever to do so, Reuters reported.

Greece has accepted the terms of its creditors, including raising the pension age, said Reuters.

There has been speculation that even as it turns from the European Union and may leave the Eurozone, Greece might turn to Russia for help — which has its own problems with an economy crippled by Western sanctions and the fall of the price of oil.

Russia may not do more than provide political support, but already Greece has indicated how it will help Russia: pushing for the new Turkish Stream pipeline and condemning the West for “torpedoing” it, reports.

Turkish Stream is a Russian project to build a pipeline from Russia to Turkey across the Black Sea. As the pipeline would cross Greece, it would stand to gain from what would eventually amount to hundreds of millions of dollars in transit fees annually. Greece accused “certain European figures and Washington” of not wanting to develop Greece’s economy and making it dependent on wealthier Western countries.

“This is unforgivable,” Panaiotis Lafazanis, the minister of industrial reform, environment and energy told Rossiya 24 TV in an interview today, saying Turkish Stream would help not only the participants but neighboring countries, as there would be 20,000 jobs created and a 2 billion euro investment.

“All of this would help the restoration of our economy. The EU should applaud us. What’s wrong with creating new jobs in Greece?” said Lafazanis.

The EU rejected Turkish Stream as not having sufficient demand among its potential customers. Earlier, South Stream, a proposed pipeline from Russia to Austria via Bulgaria, Serbia, Hungary and Slovenia, was cancelled due to concerns of Russia’s violation of EU anti-monopoly laws and sanctions imposed on Russia over the war in Ukraine.

Konstantin Simonov, head of the Fund for National Energy Security, commented (translation by The Interpreter):

“Of course the West is torpedoing Turkish Stream not due to Greece but due to Ukraine (in fact particularly because the general worsening of relations between Russia, on the one hand, and the USA and EU on the other, provoked by the Ukrainian crisis.”

He added that Turkish Stream by itself could not save Greece’s economy, but unlike Europe, Russia was proposing something to Greece that would bring real economic advances.

Unlike South Stream, where Gazprom was going to get 50% of each section of the pipeline in every country for building the pipeline, with Turkish Stream, each country will build its own infrastructure.

But with South Stream, the EU had pressured Greece to turn down transit fees, rationalizing the request with reference to the Trans-Adriatic Pipeline (TAP) being built from Azerbaijan’s gas fields, saying that it was a common European project and no one country was collecting transit fees.

— Catherine A. Fitzpatrick