Press review: Austrian blast validates Gazprom’s plans and how Russia’s exit affects Syria

Vedomosti: Gazprom’s new pipelines may get green-light after Austrian gas hub blast

On Tuesday, an explosion rocked Baumgarten, one of Europe’s biggest gas pipeline hubs in Austria, leaving one dead and many others injured. This hub handles some 40 billion cubic meters of gas from Russia and Norway per year, Vedomosti writes. This route accounts for almost one-third of Gazprom’s export to Western Europe. Prices at Europe’s gas hubs soared following the blast.

Italy may be the worst affected by the accident, but the situation there is not critical, Director at Fitch Corporations Department Dmitry Marinchenko told the paper. Gas in Italy’s underground storage facilities is enough to meet consumer demand even if the clean-up effort to deal with the aftermath takes several weeks.

The reserves in Austria’s underground storage facilities, estimated at 7 billion cubic meters, will be also sufficient, Alexander Sobko, an analyst at the Skolkovo Business School Energy Center, said. The country consumes a total of 9 billion cubic meters per year.

The accident is unlikely to significantly affect Gazprom’s exports, Sobko said. Even if the Russian gas giant’s supplies to the region within two weeks remain at minimum levels, the energy company will lose no more than 1.5 bln cubic meters of gas in supplies, Marinchenko predicted.

The disaster will have a greater impact on the talks about plans to construct Gazprom’s new pipeline projects: Nord Stream 2 and Turkish stream, the expert said. Until recently, the European Commission had reiterated that the EU had no need for new gas pipelines.

"The explosion in Austria, which disrupted Europe’s major gas hub, will be a very convincing argument for those who support building Nord Stream 2, first of all Gazprom," he said. "After such incidents it is clear that the more gas infrastructure there is, the better."

Izvestia: Asian direct investments in Russia surge 25% in 2017

China, Japan and India boosted their direct investments in Russia by 25% to $32.4 bln in 2017, mainly in fuel and energy projects, Izvestia writes citing a report by the Eurasian Development Bank’s Center for Integration Studies. In the future, Asian investors are expected to pour money into Russia’s manufacturing industry and mining sector.

Back in 2014, when Russia declared its goal of "turning to the East," few people believed this idea would prove to be successful. Russia’s companies, which were hit by sanctions, were cut off from Western capital markets. Three years down the road, some positive developments are rising in the east.

According to the report, next year will see a significant surge in direct investments in Russia and other countries of the Eurasian Economic Union, due to a number of deals between Russian oil and gas companies and their Chinese partners. Asian investors’ great interest in Eurasian economies also plays a great role.

China’s direct investments in Russia have already reached $8 bln. Kazakhstan remains the frontrunner in attracting Chinese investments among EAEU member-states. Since 2014, China has been also showing interest in investing in Belarusian machine building and transport industry.

The privatization of Rosneft, one of the major deals of 2017, could have also attracted investments from Asia, Finam analyst Alexey Kalachev said.

Japan remains the top Asian investor into Russia’s economy. Last year, Japanese investments reached $15.1bln, and 65% of the country’s investments in the EAEU accounted for Russia’s fuel industry. "Over the past years, Japanese investors have been demonstrating interest in various projects in the Far East. Further growth in Japan’s direct investments may be linked to cultivating the territories of priority development in the Far East, including the South Kuril Islands," Kalachev said.

RBC: Damascus’ resistance to reforms remains Moscow’s major headache

Russian President Vladimir Putin’s surprise visit to the Hmeymim air base near Latakia ordering the pullout of Russian forces from Syria may be considered to be a new milestone in the conflict, which coincides with the start of the election campaign in Russia. However, there is a slight catch, the political settlement under the auspices of the United Nations envisages reforms, but Damascus has been reluctant to carry any out, Anton Mardasov, expert at the Russian International Affairs Council (RIAC), wrote in an article published by RBC on Wednesday. 

Apparently, Moscow wanted to portray Bashar Assad as the sole victor in the civil war, the expert said. The Syrian leader’s visit to Sochi on November 21 once again showed that there is no equal challenger to the legitimate authorities among the opposition. This in fact may touch off problems with convening the National Dialogue Congress in Syria, he pointed out. Under the current scenario for holding the Congress, the real armed opposition will have equal voting rights with the so-called opposition forces, which have headquarters in Damascus or even Moscow. Under these circumstances, the task to boost trust among the sides towards one another becomes practically impossible, Mardasov wrote.

Moscow cites another argument in favor of convening the Congress, namely the successful operation of the de-escalation zones, but stability there leaves much to be desired, the expert emphasized.

The Iranian factor also complicates the situation, the expert noted. An Iranian-controlled corridor may be created through Iraq and Syria to Lebanon. At present, pro-Iranian foreign and local groups are concentrated in eastern Syria. On the other side of the border, there is the Iraqi militia Hashd al-Shaabi, which mostly consists of pro-Iranian groups. The increasing Shia influence in Sunni areas will be actively employed as propaganda for the Islamic State (terror group, outlawed in Russia) and raids in the deserted areas may resume. Russian forces may be needed to repel them, the expert said.

Izvestia: Manhattan attack shows Islamic State changing terror tactics

International terrorism is changing its strategy, adapting to new realities. It is turning into a vast network of lone-wolf terrorists and security agencies are not ready to counteract them, Russian and US experts told Izvestia commenting on the December 11 terror attack in New York. The attack in Midtown Manhattan was carried out by a supporter of the Islamic State (terror group, outlawed in Russia). Although the IS has been defeated in Syria and Iraq, its "soldiers" remain active in Europe and the United States, the paper says.

"The group creates absolutely autonomous cells consisting of Muslim immigrants, who are constantly under ideological pressure. The so-called IS soldiers are being bred…these are "lone-wolves" who may not have direct ties with the terrorist centers in Syria or Iraq, but who are under the influence of Jihadist ideology," Director of the Institute of Religion and Policy Alexander Ignatenko said.

Despite tougher laws and the intensifying war on terror, extremists are adapting to new realities. Now their key "soldiers" are lone-wolves who are easily influenced through propaganda over the Internet. Western security agencies can’t seem to catch up to these terrorists and commit huge blunders. Sometimes, due to geopolitical motives, they assist radical groups in the Middle East, the paper writes.

According to a research from the George Washington University's Program on Extremism, since 2014, when the IS group surfaced, 147 people have been detained in the US on suspicion of ties to the terror group, and 31% are suspected of plotting terror attacks. America is second to France among Western countries for the number of terror attacks. The majority of the arrested radicals are not immigrants, and 71% of them are US citizens. However, given the latest events, this tendency may change, the paper says.

Vedomosti: Novatek seeks to become key LNG producer in Russia

Novatek, Russia’s largest independent natural gas producer, wants to become a key player on the Russian market of liquefied natural gas (LNG) by 2030, the company’s Deputy Chairman of the Board Lev Feodosiev said on Tuesday, Vedomosti writes. By then according to its plans, Novatek will have doubled gas production to 126 bln cubic meters, and that major growth will be due to the producer’s LNG projects, the paper says.

Until recently, Russia has had one LNG plant, which operates under the Sakhalin-2 project. On December 6, Novatek launched the first leg of its Yamal LNG plant. The second leg may be put into operation in 2018 and the third one in late 2018 or early 2019. By 2021, the company plans to increase production at this project to 17.4 mln tonnes thanks to the construction of the fourth leg using Russian technology.

Novatek intends to shell out up to 2.8 trillion rubles ($47.2bln) to build the LNG facilities.

By 2030, the company may become Russia’s leading LNG producer and exporter, increasing output to 55-57 mln tonnes per year. In the future, given additional exploration, the company’s production may reach 72 mln tonnes, which is on par with LNG production in Qatar.

According to Novatek CEO Leonid Mikhelson, the government expects that Russia will account for 15-20% of the global LNG market. The company views countries of the Asia-Pacific region as the major destination for its LNG supplies. Novatek’s focus on Asian markets is attributed to its unwillingness to become a rival to Gazprom in Europe, Raiffeisenbank analyst Andrey Polischuk told the paper.

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