1. The Clouds over the
Italian-Russian Relations
Iakovos Alhadeff
2. ENI is the largest Italian company and one of the largest energy companies
in the world. The Italian public is ENI’s largest shareholder and it holds a
30% golden share of its stocks. Golden shares are shares that give certain
privileges which cannot be undone even by majority voting. These
privileges are of course determined in advance. An example could be that
the company cannot be controlled by a foreign company etc.
The Italian-Russian relations are to a large extent determined by the
Gazprom-ENI relations. The Russians offered ENI partnership in the Blue
Stream pipeline, which carries Russian natural gas to Turkey through the
Black Sea. The state owned Turkish energy company BOTAS is also a
partner of the Blue Stream pipeline. Putin also gave ENI a 20% share in the
South Stream pipeline, as you can read at the following Euractiv article
titled “Gazprom buys South Stream shares from Eni, EDF and Wintershall”,
March 2015. The French state owned Electricite de France and the German
private company Wintershall were holding the remaining 30% share of
South Stream.
Map 1
3. I must say that the energy sector in Germany is run by the private sector and
that’s why Putin did not give the German share to a state owned German
company. The big German energy companies are all private. However that
does not mean at all that the German politicians do not care whether the gas
is passing through Germany or someother country.
By giving Italy large stakes in her pipelines Russia managed to have Italy on
her side on the struggle against the EU antimonopolistic regulations, which
require the open up of the energy market i.e. the Third Energy Package.
With the Nord and South Stream Russia was keeping a balance between
Germany and Italy, because the Germans had the big stakes in Nord Stream
and the Italians had the big stakes in the South Stream. The Russians also
gave the French smaller stakes in both pipelines, even though the French are
mainly using nuclear power.
By canceling the South Stream and signing the agreement for Nord Stream
2, Russia is putting all the weight on Germany. ENI is not included in the
agreement for the Nord Stream 2 pipeline and that cannot be an accident.
However Putin offered a percentage of Nord Stream 2 to the Anglon-Dutch
Shell, trying to lure the British, since the Dutch were already involved in
Nord Stream 1. The English natural gas production is falling, and England
imports more natural gas than she is producing, and at the same time the
English see the Dutch and Norwegian production levels falling. The English
have made some deals with the Qataris for the provision of LNG, but they
are also considering the Russian gas.
4. The agreement about Nord Stream 2, which includes Royal Dutch Shell, is
coming after Centrica’s agreement with Gazprom, as you can read at the
following Independent article, titled “Gas imports from Russia's Gazprom
giant to soar after new Centrica deal”, May 2015. The article mentions that
Great Britain needs approximately 70 billion cubic meters of natural gas
every year, and Centrica has agreed to purchase 4.1 billion cubic meters of
gas every year. Centrica is one of the largest natural gas and electricity
suppliers in the UK, and in England and Wales it operates under the name
British Gas, while in Scotland it operates under the name Scottish Gas.
The late Russian moves are likely to improve Russian-English relations but
they will hurt the Russian-Italian ones. The Italians are already connected to
Libya through the Green Stream pipeline, which was inaugurated in 2004 by
Qaddafi and Berlusconi, and they are also connected to Algeria with the
Trans-Mediterranean pipeline (Algeria-Tunisia-Italy). Moreover the
Algerians and the Italians are planning the GALSI pipeline (Algeria-Italy).
Moreover the Nigerian gas can go to Europe through Italy and Algeria if the
Trans-Saharan pipeline manages to pass from the Islamic State’s affiliate
Boko Haram.
Map 2
5. In addition ENI discovered in Egyptian waters the largest natural gas field of
the East Mediterranean Sea. Zohr holds 840 billion cubic meters of natural
gas, and it is even larger than Israel’s Leviathan, which holds 500+ bcm of
gas. ENI can send Zohr’s gas to Italy and Europe. Therefore for Italy not to
decide to play the very important role she can play for Europe’s energy
security, Gazprom would have to pay very big money, and apparently the
agreement for the Blue Stream pipeline, which carries 15 billion cubic
meters of gas to Turkey, is not enough. The South Stream would carry 63
bcm of gas every year. A great article about the problems that might arise in
the Russian-Italian relations is “ENI’s Gas Discovery in Egypt Puts Pressure
on Italian-Russian Energy Ties”, September 2015, from the American think
tank Jamestown Foundation.
6. The way the Italians are putting pressure on the Germans in order to force
them to take in more Muslim immigrants is not an accident. The Italians
know that a rise of Islamism in Germany will reduce the safety of the Russo-
German pipelines and will increase Italy’s importance. Of course this is not
the only reason for their stance on the immigration issues. All red European
socialists worry about the rise of national socialism. The hundreds of
thousands of Muslim refugees that the red socialists are bringing in Europe
will make sure that it will be much harder for nationalists to gain power,
because immigrants always vote for the left.
Of course there is also a lot of money involved in immigration. The rich
Muslim countries are paying lots of money to increase the Muslim
populations in Europe, and they also spent lots of money to build Mosques,
in order to increase their influence.
Richest Countries in Natural Gas
Picture 3
7. “ENI’s Gas Discovery in Egypt Puts Pressure on Italian-Russian Energy
Ties”, September 2015
http://www.jamestown.org/programs/edm/single/?tx_ttnews%5Btt_news
%5D=44373&tx_ttnews%5BbackPid
%5D=27&cHash=aa96876e7409fa1b6fe7efb349238b09#.Vfp3Ot-qqko
“Gazprom buys South Stream shares from Eni, EDF and Wintershall”,
March 2015
http://www.euractiv.com/sections/energy/gazprom-buys-all-south-stream-
shares-eni-edf-and-wintershall-313411
“Gas imports from Russia's Gazprom giant to soar after new Centrica deal”,
May 2015
