Politico: The EU gas deal with Azerbaijan is a repeat mistake

A gas deal last month between the EU and Azerbaijan to diversify Europe’s energy sources will only enrich the autocratic regime, notorious for rampant corruption and the repression of all opposition in the country, Politico said in an article signed by Gligor Radecic, a gas campaign leader at CEE Bankwatch Network.

The article highlighted the Russian stakes in the Azerbaijani-EU deal saying that critical infrastructure needed to extract and transport the gas from the Caspian Sea to Europe is co-owned by Lukoil — a Russian oil and gas giant closely linked to Russian President Vladimir Putin’s regime. 

One of the largest oil and gas companies in the world, Lukoil has paid Russia more than 200 billion dollars in taxes in 2019 alone, Politico said, adding that the company is also among the companies on the United States sanctions list.  

Lukoil has been operating in the Azerbaijani oil and gas sector since 1994 and focused its efforts in Azerbaijan on the development of Shah Deniz fossil gas fields, which are among the largest in the world, recently becoming the second shareholder of the gas field after British Petroleum. 

The article in Politico also said Lukoil has shares in the South Caucasus Pipeline, the easternmost section of the Southern Gas Corridor, the only route linking Caspian Sea gas fields with the EU, and in the Azerbaijan Gas Supply Company, the shipper and seller of the Azerbaijani fossil gas destined for Europe. 

Ursula von der Leyen, the President of the EU Commission said that Azerbaijan is “a crucial and reliable partner for our security of supply,” but the Politico article argued Russian involvement in key parts of the Azeri gas supply chain en route to Europe casts doubt over any energy security claims. 

The article concluded: 

“It’s high time the Commission starts learning from its past mistakes concerning energy diversification and energy security based on the deals it’s made with autocratic regimes. They only serve to perpetuate Europe’s fossil fuels fixation, exactly when it most desperately needs to end.”