with Fatih Birol, Chief Economist, IEA (International Energy Agency)
In the question and answer session, you talked candidly about advice that you might offer to the Russian government and thereby to Gazprom about the drop in gas demand in Western Europe. What do you think this means specifically for projects such as Nord Stream, South Stream, and Nabucco? Do you still think they are wise investments?
If there is a climate deal at Copenhagen, gas demand will be affected. When we look at all these pipeline projects, the main question was up until now whether there was enough supply to send from this part of the pipeline, in Russia and the Caspian and iran. I think with these numbers I presented here at the conference, and if there is a climate deal, there will be a second question: whether or not there will be enough demand on the other side of the pipeline. Therefore, my answer to your question is that I think many of those pipeline projects I showed in the presentation may have to live on the map only, and not see the light of day, and the level of competition between different projects will be much harsher in terms of the economic, political and technological viability.
About Copenhagen: how optimistic are you that a useful agreement will be reached?
There are many obstacles still, but as I have been saying for the last month, I remain cautiously optimistic that there will at least be a broad international political commitment, and the details of that commitment will be mapped out within the next six months, perhaps to June, where we will see it and understand better what will be the implications for each country, but what I need to see is a signal, a firm political signal, so that the energy sector has better guidelines what they are going to do, what are the priorities and what which factors they take into consideration when making investments. Currently, the energy industry is paralysed. Why is it paralysed? Because of the financial crisis, in many cases lack of access to credit, and the second, they do not know what kind of role the climate will play. So, there is a lot to be answered in this I think, with the rebound of the economy, there will be a new wave of investment coming forth, all this investment which we are waiting for that has been postponed or delayed and so on. But I hope those investments will have the stamp of climate when they are made, and take into account the climate change regulations, which are due very soon. There is a need for clarity for the energy industry.