Despite Metsola’s ‘Autocratic Regime’ Warning, European Commission Signs Gas Deal With Azerbaijan
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The European Commission has signed a major gas deal with Azerbaijan despite a recent warning by European Parliament President Roberta Metsola against the EU relying on “autocratic regimes” for its energy supply.
EC President Ursula von der Leyen travelled to Baku today to sign a Memorandum of Understanding with Azeri President Ilham Aliyev on a strategic partnership in the field of energy.
This deal will double the capacity of the Southern Gas Corridor – linking Azerbiajan to Europe to deliver at least 20 billion cubic metres of natural gas to the EU annually by 2027.
Azerbaijan delivered 8.1 billion cubic metres of gas to the EU in 2021 and this is expected to rise to 12 bcm this year.
The Azeri deal is intended to help phase out the EU’s reliance on Russian gas for its energy needs, although even the new deal will still amount to a fraction of the gas the bloc imports from Russia, which is estimated at 155bcm a year.
Von Der Leyen hailed Azerbaijan as a “reliable energy supplier” and a “key partner”, hailing the deal as one that will kickstart a “new chapter in our energy cooperation with Azerbaijan will lay the foundations of a long-term partnership, not only on natural gas, but also on renewables”.
However, this is a far cry to what Metsola had said about Azerbaijan last May.
After the European Parliament called for a full embargo on Russian energy imports, Lovin Malta asked Metsola in an interview whether she views energy-rich Azerbaijan as a potential alternative source of gas.
However, she voiced scepticism about this, arguing that the EU’s energy union means the bloc shouldn’t be “dependent on autocratic regimes in order to get our energy supply.”
Instead, Metsola argued that the EU should look at the likes of Spain and Portugal, as well as North African countries.
“Spain and Portugal are energy islands, which means they have their own supply but don’t give it to others; we must see if there’s a possibility to create links to Spain and Portugal,” she said. “For those countries who find themselves looking at third countries, we’re looking at Algeria, Egypt… North Africa is crucial.”
“If you ask me, for the European Parliament, I don’t want to go from one unreliable partner to another and that must be our goal.”
Azerbaijan’s state oil company Socar is part of the Electrogas consortium which runs the Delimara power station and is in charge of providing the power station with LNG.
It has proven to be extremely controversial, particularly after one of its shareholders, Yorgen Fenech, was in 2019 charged with the assassination of journalist Daphne Caruana Galizia.
![The Electrogas power station in Delimara (Photo: Electrogas)](https://lovinmalta.com/wp-content/uploads/2022/05/Untitled-design-2022-05-23T204655.011-1024x536.jpg)
The Electrogas power station in Delimara (Photo: Electrogas)
Caruana Galizia’s son Matthew Caruana Galizia has said he believes his mother was murdered to stop her revealing a trove of internal Electrogas documents that had been leaked to her by a whistleblower.
After links were drawn between the project and the murder, the Gasan Group – a shareholder in a Maltese company that forms part of the consortium – declared it was “mortified” and said it intends to exit the deal.
However, it is yet to actually sell its shares and the case against Fenech is ongoing, while no charges have been brought against ElectroGas.
The leaked documents were then shared with an international team of journalists as part of the Daphne Project, which won an award from the European Centre for Press and Media Freedom.
As part of the Daphne Project, The Guardian revealed in 2018 that the deal was seeing Malta lose millions of euro because it had committed itself to purchasing gas at a fixed rate for five years.
With the global gas market plummeting, Malta was forced to pay twice the market rate.
However, the COVID-19 pandemic and Russia’s invasion of Ukraine later caused gas prices to surge to record levels, placing the deal in a new perspective.
Former Prime Minister Joseph Muscat recently said the hedging deal saved Malta around €125 million.
Cover photo: Left: European Parliament President Roberta Metsola during an interview with Lovin Malta last May, Right: European Commisison President Ursula von der Leyen signs an MOU with Azerbaijan’s President Ilham Aliyev
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