Konstantin Simonov’s speech presentation at The Investment Energy Summit Greece, Cyprus, Israel "Re-designing the European energy map". Athens, Greece, March 28, 2012.

1. National Energy Security Fund
Russia and Europe:
Battle or
Cooperation?
Konstantin Simonov
Athens
March 28
2012

2. Choice Point
• Сhoice point for Europe: to preserve Russia
as the main supplier of gas or to continue
the process of diversification and
liberalization of market
• Choice point for Russia: struggle for
European market or reorientation to new
consumers in Asia
• Europe wants to implement American
model of market. But in USA gas market is
self-sufficient
• Main question for Russia: to invest money
to greenfields or to wait
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3. Situation is Returned to 2007
Gazprom Supplies to Europe, Turkey,
Billion Cubic Metres
165
158,8
160
155
150,5 150
150
145
140,6
138,6
140
135
130
125
2007y 2008 y 2009 y 2010y 2011y
Source: Gazprom
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4. Situation is Returned to 2007
Gazprom supplies to Europe and Turkey, bcm
2007 2008 2009 2010 2011
Germany 39 34.7 31.4 34 34
Italy 21 22.3 19 13 17.1
Turkey 23.4 23.8 20 18 26
France 9.8 10.4 10.1 9.8 9.5
Finland 4.7 4.8 4.4 4.8 4.2
Austria 5.4 5.8 5.4 5.6 5.4
Greece 3.1 2.8 2.1 2.1 2.9
Netherlands 4.4 4.4 4.3 4.3 4.4
Switzerland 0.3 0.3 0.3 0.3 0.3
Belgium 0.1 0 0 0 0
Great Britain 1.2 7.5 7.3 6.8 8.2
Hungary 6.4 8.9 7.6 6.9 6.3
Poland 7 7.9 9 9.9 10.3
Slovakia 6.2 6.2 5.4 5.8 5.9
Czech
7 7.6 6.4 8.6 7.6
Republic
Romania 3.9 3.6 2 2.3 2.8
Bulgaria 3.4 3.5 2.6 2.7 2.8
Serbia 2.1 2.2 1.5 1.8 1.4
Croatia 1 1.1 1.1 1.1 0
Bosnia and
0.3 0.3 0.2 0.3 0.3
Herzegovina
Macedonia 0.1 0.1 0.1 0.1 0.1
Slovenia 0.6 0.6 0.5 0.5 0.5
Total 150.5 158.8 140.6 138.6 150
Source: Gazprom
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5. What will be the Rules
after 2022-2026?
Gazprom's Contract Quantities Exclusive of Renewal
200
180
160
140
120
100
80
60
40
20
0
2011y 2015y 2020y 2030y
Source: Gazprom
Greece is an exception:
contract will be finished at 2016 (3bcm)
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6. Old or New Partners?
• Turkmenistan!
• Iran!!
• Qatar!!!
• LNG from North America!!!!
• Shale gas!!!!!
• Mozambique!!!!!!
• Whose else?
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7. Main Problems
• Price war for Azeri gas
• Increasing of the role of Turkey
• Political price of development of
South Corridor
• Consequence of War in Iran for
Caspian Region
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8. More Talks than Gas
• 16 bcm – 6 bcm for Turkey = just 10 bcm
Shakh Deniz Cup
TAP
TAP
ITGI
10 bcm!!!
Nabucco
SEEP
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9. Caspian Gas is not Cheap
Estimate Price for European Consumers
450 397 415
380 373
400
350
300
250
200
150
100
50
0
Price for European Price for European Price for European Average price for
consumers for Azeri consumers for Azeri consumers for Azeri Russian gas (nine
gas transporting gas transporting gas transporting months ended
through Nabucco through ITGI through TAP September 30, 2011)
Price of Azeri Gas (2011)
Source: RWE, Gazprom, NESF 280
300
250
250
200
150
100
50
0
Price for Russia Price for Rturkey
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Source: Neft Rossii

10. Сonsequences of Soon War?
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11. Сonsequences of Soon War?
Ethnic structure of Iran Population
(million people)
13
Persians
5
Azerbaijanians
Kurds
45 Others
12
Source: The University of Texas
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12. Сonsequences of Soon War?
Shares in Shakh Deniz Field
9,0%
10,0% 25,5%
BP (operator)
Statoil
Total
10,0%
NICO
Lukoil
SOCAR
10,0%
TPAO
25,5%
10,0%
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13. South Corridor vs.
South Corridor
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Source: Gazprom

14. Thank you!
www.energystate.ru
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