The energy crisis

A major gas pipeline project advocated by Madrid and Berlin has faced resistance from Paris, El Pais and several other Spanish news outlets reported this week, citing a letter by the French Ministry of Energy Transition.

Spain imports natural gas from Algeria through two undersea pipelines – the Maghreb-Europe and the Medgaz.

Dubbed the Midi-Catalonia Pipeline or MidCat, the project aimed to create a gas transit network spanning hundreds of kilometers across Spain and France and provide some 7.5 billion cubic meters of gas transit capacity. It was first pitched in 2015, but was canceled in 2019 by France, which was to cover a major portion of its costs and deemed it financially non-viable.

The MidCat idea was revived in May 2022, amid fears of a looming energy crisis due to potential cuts in gas supplies from Russia – the continent’s major energy supplier – amid the conflict in Ukraine. Madrid and Berlin are “pushing hard to revive it,” according to El Pais. Paris, however, appears unconvinced.

“Such a project would require, in any case, many years [for it] to become operational,” the French ministry led by Agnes Pannier-Runacher said in an emailed statement, seen by El Pais and several other Spanish outlets.

It would take many years to complete just the relevant studies and other documentation related to such a project, the ministry argued, adding that MidCat is unlikely to help with the current energy crisis in the EU or the potential shortages this winter. Instead, Paris suggested building more liquified natural gas terminals, calling them “smaller and faster investments.”

Building a pipeline might also interfere with climate goals, the French ministry said, adding that “to meet both the current energy challenge and the climate challenge, we will have to reduce our gas consumption and accelerate the development of carbon-free energy [sources].”

German Chancellor Olaf Scholz said at a press conference in Berlin last week that he asked his Spanish and Portuguese counterparts to “discuss” the project, adding that he was “in talks” with French President Emmanuel Macron and the EU Commission head Ursula von der Leyen.

Spain’s Third Deputy Prime Minister Teresa Ribera followed up by saying the Spanish part of the project could be ready “in eight or nine months.”

www.rt.com/news/561188-france-oppose-spain-gas-pipeline

China purchased 7.42 million tons of Russian coal last month, according to data released by the General Administration of Customs on Saturday.

The figure marks the highest monthly level since comparable statistics were launched in 2017. It was up from 6.12 million tons China imported in June and 6.49 million tons in July 2021.

Western buyers opted to avoid shipments from Russia ahead of an EU ban on the country’s coal, which came into effect on August 11. The embargo, aimed at reducing Moscow's energy revenue, is part of sanctions over Russia’s military offensive in Ukraine.

The Western restrictions have created opportunities for Asian powers, particularly China and India, to boost purchases of Russian coal at discounted prices. Russian thermal coal with a heating value of 5,500 kilocalories reportedly traded at about $150 per ton in late July, while coal of the same quality at Australia's Newcastle port was priced at over $210 per ton.

China is Russia’s largest coal buyer, taking in more than 50 million tons of the commodity worth $7.4 billion last year via rail and sea, from Russia’s Far East. Russia accounted for roughly 15% of China’s total coal imports during that period, and was its second-largest supplier behind Indonesia.

China’s shipments of Indonesian coal, mostly cheaper and of lower quality, with a heating value below 3,800 kcal, amounted to 11.7 million tons in July, up 22% from June but down 40% from a year earlier. Meanwhile, the country’s customs data showed zero coal shipments from Australia last month.

www.rt.com/business/561210-china-coal-imports-russia

Siemens has apologized for jokingly offering emotional support to a Nord Stream 1 gas turbine, which is stuck in Germany due to international sanctions. The gesture coincided with Russia’s announcement of an upcoming halt of gas transit via the pipeline.

“Our famous turbine is still not where it should be. It stands alone on our site in Mülheim an der Ruhr. Let’s do the poor thing a favor and create a Spotify playlist,” the company tweeted on Wednesday, while recommending kicking off the list with ‘So Lonely’ by The Police.

However, by Friday night, the German technology giant realized that the “tonality” of the tweet was “inappropriate,” and offered an apology, saying they never intended to hurt anyone’s feelings.

“We’ve deleted our tweet about the turbine, which triggered a controversial discussion,” the company said, making sure to emphasize that “we condemned the war in Ukraine from day one” and “continue to do so.” The public apology failed to appease critics, however, as the company was immediately bombarded with new demands to halt any business with Russia, condemn Moscow, and donate all proceeds to Ukraine.

Siemens offered the mea culpa shortly after Gazprom announced that all natural gas transit to the EU via the NS1 will be halted from August 31 to September 2 for maintenance on the last of the pipeline’s six turbines that was operational.

Russian gas supplies through the NS1 dropped to 20% of their maximum level last month because the rest of the turbines require an overhaul, while one of the units remains stuck in Germany. It was supposed to be transported to the pipeline’s compressor station in Russia in May, after undergoing maintenance in Canada.

Gazprom has insisted that the Western sanctions are hindering the return of the turbine and threaten future maintenance of equipment. According to the company, the paperwork for the part’s return is not in order, as it was issued by Siemens Energy and not the firm that is contracted by Gazprom.

www.rt.com/business/561234-siemens-gazprom-turbine-apology

The UK could face a “humanitarian crisis” involving ill health, excess deaths and rising inequality if the government does not take urgent action on rising energy bills, the National Health Service (NHS) Confederation warned on Friday.

The organization wrote to the chancellor of the exchequer, claiming that failing to act would add more pressure on health services that were already strained. According to the NHS, if energy bills become unaffordable, the country’s health and social care system will be left to “pick up the pieces.”

“The country is facing a humanitarian crisis. Many people could face the awful choice between skipping meals to heat their homes and having to live in cold, damp and very unpleasant conditions,” wrote the head of the NHS Nadhim Zahawi. “This, in turn, could lead to outbreaks of illness and sickness around the country and widen health inequalities, worsen children’s life chances and leave an indelible scar on local communities.”

The NHS highlighted that, in addition to causing more sickness, mass fuel poverty was also likely to “increase the already high number of annual deaths associated with cold homes.” It noted the situation could also affect mental health.

“Health leaders are clear that unless urgent action is taken by the government, this will cause a public health emergency,” Zahawi stressed.

The warning comes as energy bills for the average household in Britain are projected to rise to more than £4,200 ($4,960) per year from January 2023 after the next increase in the price cap. Last October, it was set at £1,400 ($1,653).

www.rt.com/business/561169-britain-warned-humanitarian-crisis

Canadian Foreign Minister Melanie Joly said on Wednesday that her government will ship the five turbines from Montreal back to Germany, despite demands from ethnic Ukrainians and Kiev’s ambassador in Ottawa to hold onto them. Joly revealed that the decision was made after a request from German Chancellor Olaf Scholz, who is currently visiting Canada.

“That was the decision that we took,” Joly said in an interview with the state broadcaster CBC. “That’s exactly what Germany asked us.”

“Canada doesn't want to give any form of excuse to [Russian President Vladimir] Putin to continue to weaponize his flow of energy to Europe,” Joly told CBC’s Hannah Thibedeau.

Six Siemens turbines were in Montreal for maintenance when Canada announced an embargo against Russia over the conflict in Ukraine. At Germany’s request, Ottawa announced an exemption for the turbines in July, and sent one of them over, but Gazprom declined delivery, citing irregularities in documentation.

Scholz, who was in Ottawa this week to sign agreements on developing hydrogen power with his Canadian counterpart, Justin Trudeau, told CBC that the two countries would continue to cooperate on having the five remaining turbines returned.

“I think there is political understanding that we will cooperate, that we are friends and that we will not make it feasible that the Russian game is working,” Scholz told host Vassy Kapelos.

Ukraine and Germany have accused Russia of holding the EU hostage with gas deliveries. Gazprom has said it would fulfill all of its contractual obligations but cannot be faulted when the EU or Canada impose unilateral embargoes on equipment – such as the Siemens turbines for Nord Stream 1, a pipeline under the Baltic Sea that bypasses Ukraine.

www.rt.com/news/561494-canada-turbines-gas-ukraine

European countries supporting Ukraine against Russia should brace for a full suspension of natural gas supplies by Moscow during the upcoming winter, Spanish Defense Minister Margarita Robles has warned.

“We are going to have a winter of great suffering,” the cabinet member told Radio National on Wednesday, adding: “in Europe, we have to work hard to be ready to deal with it.”

Robles claimed that Russian President Vladimir Putin is already throttling the supply of gas to the continent, apparently referring to the reduction in deliveries by Russian energy giant Gazprom.

The company has blamed external factors for the loss of capacity, noting that Ukraine is refusing to pump gas through one of the routes running through its territory. Gazprom has also pointed to the sanctions-related delay in returning a German-made turbine for the Nord Stream 1 pipeline, following maintenance. European nations, meanwhile, have accused Moscow of reducing the flow for political motives.

www.rt.com/news/561506-eu-winter-suffering-gas