By Alexei Anishchuk
AMSTERDAM, April 8 Russia's Gazprom
and Dutch Gasunie signed a letter of intent on Monday
to explore the potential expansion of the Nord Stream pipeline
to Britain, one of several deals signed during President
Vladimir Putin's visit to the Netherlands.
If the project comes through, the extended arm of Nord
Stream would give Gazprom greater access to Britain, which has
an annual demand of 100 billion cubic metres (bcm).
For the Netherlands, long-term cooperation with Gazprom
would secure gas flows as its gas reserves dwindle and the
country is expected to become a net importer of gas in 2025.
Alexei Miller, head of Gazprom, said the two companies
discussed the possibility of increasing the Nord Stream pipeline
with a line that will go to the United Kingdom. He said the
capacity of the new pipeline would be about 27.5 bcm, the same
as the capacity of each of the two existing pipelines.
"The key issue is to sign a long-term contract with our
British partners to supply gas to the British market," Miller
told reporters in Amsterdam.
Nord Stream has annual capacity of 55 bcm, enough to supply
around 10 percent of the EU's annual gas needs. The pipeline
makes landfall in Lubmin, northeast Germany.
Because of rules limiting the market share of individual
distributors within the European Union, Gazprom has been unable
to use the pipeline at maximum levels.
"The infrastructure in northwestern Europe can be improved a
little bit further so they (the Netherlands) need support (from
Russia) for investment," said Hans Van Cleef, an ABN Amro energy
"Russia would of course like to benefit from this hub in the
Gazprom and its oil arm Gazprom Neft signed two
deals with Royal Dutch Shell - one for joint shale oil
exploration and drilling, the other for joint exploration and
drilling of hydrocarbons on Russia's continental shelf.
The deals underscore the Kremlin's drive to open up access
to Russia's trove of hard-to-recover energy reserves to
international energy firms with the expertise needed to secure
its position as a leading global oil and gas producer.
"Strong Russian-Dutch energy relations are of great
importance to both our economies," said Henk Kamp, Dutch
minister of economic affairs, during Putin's visit.
"We value them even more today, as they stimulate economic
growth and enhance energy security."
In recent years, the two countries have stepped up
cooperation in the energy sector to include projects such as
pipelines and gas and oil storage.
Gazprom will secure cushion gas for Europe's biggest natural
gas open access storage to be built in the Netherlands in
exchange for nearly 2 bcm of capacity.
Once it is completed in 2015, Gazprom will gain nearly half
or 1.9 bcm of gas in Bergermeer storage, which is 20 kilometres
away from the BBL pipeline that takes gas from the Netherlands
to the Britain.
A consortium of Vitol Tank Terminals International (VTTI)
and Russian investment group Summa will invest $1 billion in a
new terminal in Rotterdam port.
Once it is fully operational in 2016, the terminal will have
the capacity to handle 2 million tonnes of crude oil and 1
million tonnes of refined oil products, taking significant share
in global oil trade.