European Union energy companies court Moscow
Their ties with Kremlin-backed Gazprom are vexing EU efforts to create an energy security policy that would lessen dependence on Russia.
By Jeffrey White | Correspondent of The Christian Science Monitorfrom the June 21, 2007 edition
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Berlin - Burckhard Bergmann, chairman of the board at German energy supplier E.ON Ruhrgas, holds another title not likely to appear on his business card: Russia's honorary consul in the state of North Rhine-Westphalia.
Mr. Bergmann took the post late last year, raising some concern about conflicts of interest between Germany's largest energy company and one of the world's largest energy exporters.
"President Putin told me, 'You are my new employee in Germany now,' " joked Bergmann – the only foreigner with a seat on the board of Gazprom, Russia's energy giant – during a recent interview in Der Spiegel, a prominent German news magazine. "But he was laughing when he was saying that."
Brussels isn't laughing. As European Union (EU) leaders – meeting Thursday for a two-day summit – struggle to establish a unified energy security policy that will lessen the bloc's dependence on Russia, the close ties between many European energy companies and Moscow pose a signficant challenge.
In a bid to secure a foothold in Russia's vast natural-gas reserves, E.ON, Gas de France, and Eni of Italy have in the past year signed new, long-term contracts with Kremlin-backed Gazprom that allow it direct access to their markets and consumers. The result is that Gazprom's grip on European markets is growingstronger, controlling not only the exploration and delivery of natural gas, but, increasingly, the sale of it as well.
"This is a problem for Europe," says Katinka Barysch, chief economist at the Center for European Reform in London. "What we're trying to do in Europe is create an integrated, open, and liberal gas market. You can't do that if you have one company controlling the entire gas supply chain."
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