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Analysis: Russian gas reservoirs for EU?

by Stefan Nicola
Berlin (UPI) Mar 3, 2009
Russian gas monopoly Gazprom is considering constructing Europe's largest gas storage facility in Germany, claiming the project would increase Europe's energy security.

"This is an investment in Germany's and Western Europe's supply security," Burkhard Woelki, spokesman of Gazprom Germania, told United Press International in a telephone interview Monday. Such a reservoir, he said, which would cost an estimated $500 million, would be a boon for European energy security.

Much of Europe was in the cold during the first part of January after a gas supply and payment dispute between Russia and Ukraine. Russia supplies 25 percent of Europe's gas consumption, 80 percent of which transits through Ukrainian pipelines.

Gazprom has dispatched its geologists to the German state of Brandenburg. Here in what once was communist East Germany, the experts have identified a scarcely populated area of roughly 100 square miles that within the next few years could be home to Western Europe's largest underground gas storage site.

Over the next two years Gazprom will do test drilling to find out whether a geological formation roughly a mile below ground, made up of sandstone, is indeed as promising as experts believe.

If so, the underground cavern, sealed by granite and clay deposits, could hold between 8 billion and 10 billion cubic meters of natural gas.

The storage site could help the continent through supply disruptions such as the one sparked by the gas row between Ukraine and Russia earlier this year, Woelki said.

While some Eastern European countries suffered from gas shortages, Germany, a major importer of Russian gas, was able to shrug off the crisis in part because of its 40 gas storage sites all over the country.

Gazprom says the additional site is needed because of Nord Stream, a German-Russian gas pipeline project that will link Western Siberia and Germany under the Baltic Sea.

Eventually, Nord Stream will deliver roughly 55 billion cubic meters of gas per year, and Gazprom could store part of the gas in Brandenburg.

The company already has finished test drilling in an area of Mecklenburg-West Pomerania state, just north of Brandenburg. Gazprom will announce the results this summer, Woelki said. If both sites prove promising, Gazprom may develop one or both -- that's still undecided.

Either way, for Gazprom, an additional gas storage site makes sense. The company could store leftover gas in the summer, for example, and sell it -- for more money -- in the winter months, during times of peak demand.

Officials from the Brandenburg state government have welcomed Gazprom's plans. They would increase Brandenburg's and Germany's role as a "hub for gas deliveries to all of Europe," Brandenburg Economics Minister Ulrich Junghanns said in a statement. Gazprom has promised to include local companies in the construction process, so the storage site may even create jobs. The company recently presented its plans for a gas reservoir to the local population in Brandenburg, and "we got positive feedback," Woelki said.

Brandenburg has developed into a major energy center in Germany. Once home to East Germany's lignite mining industry, the state in the years after Germany's reunification pushed the share of renewables to some 40 percent of the power mix. While it still supports dirty coal, the state is also home to the world's first clean coal test plant based on carbon capture and storage technology, run by Swedish energy giant Vattenfall.

But not everyone in Brandenburg is happy about Gazprom's latest plans. Officials from environmental groups have warned of possible gas leakages; they also fear security threats because the German military has identified a nearby area as a test site for air-to-ground bombing.

The local population, however, has protested against the test bombing site, and it is unlikely that Germany's air force can actually fly there.

Woelki dismissed any security or environmental concerns as baseless. "If there is a security risk, the storage site won't be built," he told UPI. "But sites like these are absolutely safe."

As for leakage: Gazprom has zero interest in building a storage site that leaks and wastes gas, he said. "Gas is expensive."

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