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Moscow carefully assessing international energy scene

As the Saudi-led sanctions against Qatar raise concerns about liquefied natural gas (LNG) export prospects, Russia is weighing its options. The Middle East is key to Russia’s Energy Strategy to 2030, adopted in 2009. The document calls not only for Russia to diversify its gas exports to decrease dependence on European consumers, but to create a Eurasian gas-trading network under Russian control.

Summary⎙ Print Russia’s long-term energy plan relies heavily on gas sectors in the Middle East and Eurasia as it struggles with low prices and sanctions.
Author Nikolay Kozhanov

The Qatar crisis, which began in early June, amends Russia’s approach to accessing the Middle East gas market. On the one hand, the Kremlin is trying to distance itself from the Saudi-Qatari rift, as picking sides might harm Russia’s relations with either party. On the other hand, Russian authorities are trying to flirt with both sides so they will continue to cooperate with Moscow in the oil and gas sphere.

During two weeks in late May to early June, Moscow first welcomed Saudi Prince Mohammed bin Salman and Oil Minister Khalid al-Falih, and later Qatari Foreign Minister Mohammed bin Abdulrahman Al Thani. Apart from meeting with his Russian counterpart, Alexander Novak, Falih met with top management of state-run oil giant Rosneft and Novatek, Russia’s largest natural gas producer, to confirm Saudi interest in buying into Russian Eurasia Drilling Co., an oil service firm that soon might be implementing projects in the Middle East and North Africa region. Falih also expressed interest in discussing options for Saudi investments in the development of another Russian LNG project — Arctic LNG.

Iran is another important component for Russia in this respect. In May, Russia’s energy behemoth Gazprom reaffirmed its interest in helping Iran build its first LNG plant. The project would involve gas delivery from Iran to India and possibly, eventually, to Laos and Cambodia.

Gazprom’s management also doesn’t rule out participating in construction of an Iran-Pakistan-India gas pipeline — which might imply Gazprom’s involvement in developing the Iranian gas fields necessary to feed it.

Although the company’s representatives make it clear that Gazprom is only discussing such prospects and the final decision will be made only after technical and economic assessments, analysts have already raised questions regarding the projects’ feasibility. Indeed, at the current stage, existing political, economic and administrative risks don’t justify the volume of investments necessary to implement these projects, not to mention that the Russian company might not be technically ready to help Iran: Gazprom itself does not have full access to LNG technology and the company is still doing the necessary research to gain it.

In other words, experts Al-Monitor interviewed have doubts that, in the short term, Gazprom would be able to accomplish the projects even if it decided to participate in them.

However, neither Gazprom nor Russian authorities plan their actions in Iran from a short-term perspective. On the contrary, their actions in the region are determined by the long-term strategy of Russian oil and gas sector development that sets Moscow’s priorities in this field until 2030. According to the strategy, Russia’s foreign policy on ensuring the security and profitability of Russian gas corporations is supposed to be relatively aggressive and expansionist. Moreover, Moscow’s ultimate goals should be to preserve the Russian gas corporations’ presence in the European market and the manifold increase in Russian gas exports to Asia and the Middle East. Russia expects to achieve these aims not only by raising the output of domestic gas fields, but also by participating in the energy sectors of other countries (both hydrocarbon producers and consumers) and establishing Russian influence over most of Eurasia’s gas transportation infrastructure.

Gazprom isn’t the only Russian company trying to enter the Middle East gas sector. Other Russian giants such as Lukoil and Rosneft are present in the region. In late 2016, Rosneft said it was purchasing a 30% share in Egypt’s Zohr gas field from Italy’s Eni SpA. It also signed a contract to supply LNG to Egypt, and 10 shipments are expected in 2017. This year, Rosneft started negotiations to export LNG to Kuwait.

Russia’s interest in the Middle East gas sector is at least threefold.

First, Russia sees the region as both a consumer market and a potentially promising region for gas industry development. Russian gas companies pay special attention to the Persian Gulf and the Indian Ocean areas. Russia’s interest in the Gulf Cooperation Council market is largely explained by growing domestic demand for natural gas among the Gulf monarchies, partly boosted by their economic diversification programs to replace domestic consumption of oil with gas.

In 2016, Gazprom and Bahrain National Oil and Gas Authority agreed to strengthen their cooperation in producing and distributing LNG. In April, Russia intensified its contacts with Bahrain, which resulted in the latter's inviting Gazprom to join a number of oil and gas projects. Also in April, a Rosneft delegation visited Bahrain, presumably to discuss possibilities for Rosneft to participate in building Bahrain’s LNG-receiving infrastructure.

Second, if Russian companies could obtain access to Middle Eastern resources, that would strengthen Russia’s presence in other regions’ energy markets, either via swap deals with Middle Eastern producers or by providing Russian energy majors with additional gas resources for re-export. Consequently, Russia is developing the local capacities for LNG production and export. This is especially the background behind Russia’s approach to Iran, Oman and Bahrain. Moscow obviously believes that if it becomes involved in these projects it can use the regional infrastructure to reach gas markets in India, Pakistan, South Asia and Southeast Asia. That’s one rationale behind Gazprom’s interest in LNG projects in Iran, although Tehran will hardly be able to build the LNG factory and provide it with the necessary gas volume anytime soon.

It might not be a coincidence that Russian conglomerate Rostec is currently negotiating its participation in the construction and subsequent management of the so-called “North-South” gas pipeline in Pakistan, which would connect LNG-receiving facilities in Karachi and Gwadar with power plants and factories in Lahore. According to the Russian side, the project is almost ready to begin construction, but Rostec has not yet reached agreement with Islamabad on the fees Pakistan would pay to use the pipeline. However, Moscow hopes to reach an agreement soon, and that’s when it would need Iran: Natural gas for this pipeline might be supplied by Russian traders via potential swap operations with Iranian gas if Tehran builds the necessary infrastructure.

Finally, Middle East hydrocarbon exporters are challenging Russia’s positions in the energy market. Iran has never hidden its intention to compete with Russia as a gas supplier to Europe. Al-Monitor has already discussed the way Moscow is reacting to this challenge, which is only a concept now, but may become very real down the road.

It will not be easy for Russian energy companies to enter the Middle East and North Africa gas sector. Regional and international companies both see Moscow as a rival and will most likely try to deter its progress in that regard by any means available. Yet the main obstacle in Russian businesses’ path to the Middle Eastern gas sector will be economic and connected to Russian domestic issues. Russian energy companies are struggling with low oil prices and international sanctions. These, in turn, limit their ability to finance ambitious and long-term projects abroad.

For instance, in May, Lukoil decided to pull out of the Luksar (Lukoil Saudi Arabia Energy) Co. joint venture established in 2004 to explore and develop gas fields in Saudi Arabia. Experts close to Lukoil told Al-Monitor that Western sanctions prevent the company from obtaining the cheap foreign loans necessary to finance its ambitious projects. Consequently, Lukoil is compelled to reconsider its development strategy. The company is expected to stop participating in a number of other oversees projects that are either risky, financially demanding or not profitable enough. It’s possible that Luksar’s case could be just the first in which international sanctions and low oil prices prevent Russian companies from strengthening their Middle East positions. Consequently, Russia’s success in implementing its Energy Strategy to 2030 may also fall into question.

Read more:

LNG Developing Rapidly in the Baltic Sea Region

 May 2017

In the Baltic Sea region, the liquefied natural gas market has developed dynamically and new methods of LNG transport and use stimulate infrastructure investments. Poland will compete on this market with other regional gas-importing countries and with Russia, which is developing its own LNG potential.

Once the LNG terminal expansion in Poland is complete, additional volumes of natural gas can be sold to new clients needing small-scale LNG supplies and in the transport sector. The LNG terminals in Poland and Lithuania have annual import capacity of 5 bcm and 4 bcm, respectively, and are the first such facilities in the region. They allow both countries access to the global liquefied gas (LNG) markets.

Besides diversification of supplies and increasing energy security, the terminals also allow the countries to expand their contract portfolio. The sales stimulate the development of small-scale LNG infrastructure: smaller terminals, LNG carriers and tanker trucks with maximum capacities of 17.5 mcm to 1.3 bcm. This enhances LNG availability for road and maritime transport, the power sector, and industry in general.

Significance of the LNG Industry.

LNG can be delivered to end consumers even when there is no pipeline infrastructure, which makes it flexible and competitive. In recent years, the LNG trade has become more liquid: global trade and the number of importing countries have grown, prices fallen, and the average length and volume of contracts decreased. The global liquefaction capacity amounts to 462 bcm.

Qatar, the biggest exporter, has almost a quarter of the capacity itself, at 105 bcm. The U.S. and Australia are investing heavily in their own terminals and their LNG export capacity after 2022 will increase by, respectively, 78 bcm (to 92.6 bcm) and 42.3 bcm (to 115.6 bcm). According to a recent forecast by energy giant Shell, LNG demand will increase to 734-782 bcm in 2035 (from the 351 bcm traded currently).

The LNG market’s development has been stimulated by environmental legislation, new applications, and expanding small-scale LNG use. The EU introduced a maritime fuel emissions cap for some areas, including the Baltic Sea. This gives LNG the upper hand there because it’s considered a cleaner fuel. The EU’s CO2 emissions limit means the consumption of LNG, which emits half as much CO2 as coal, will grow both in the energy sector and industry. Natural gas also will compete with coal because of its advantage as back-up fuel for renewables. More often it is being used for power and heat micro generation and as fuel for trucks, public transport and railways.

The greater availability of LNG, lower transport costs and development of small-scale LNG transport fleets allow shipments of smaller volumes of natural gas to local markets not connected to a gas grid. Not only regional importers but also exporters such as Russia want to take advantage of this trend. Small-Scale LNG in the Baltic Sea Region.

Both Poland and Lithuania seek ways to make their LNG exports more profitable. They are renegotiating long-term LNG import contracts and complement them with spot contracts. According to a recently published strategy by Poland’s PGNiG, the country’s LNG imports are set to improve in competitiveness. In one example, the company bought LNG from Norway’s Statoil on the spot market last year.

This year, PGNiG’s London LNG trade office opened and signed its first contract with 2 Cheniere Energy from the U.S. (also on the spot market). Both Poland and Lithuania want to find new consumers for their natural gas. Small-scale LNG creates new market opportunities. The Lithuanian terminal already has been equipped to enable LNG re-export in smaller tankers, and as of June, the terminal will be able to bunker ships and fill tanker trucks. This will enable Lithuania to sell LNG to Latvia, Estonia and Poland. Vilnius wants to gain experience in this sector by cooperating with Belgian firm Fluxys.

The Polish terminal can export 120 mcm LNG in trucks and has already sold some LNG to Estonia using this method. This year, operator Gaz-System decided to expand Poland’s LNG terminal to reach import capacities of 7.5 bcm and will build rail transport infrastructure. Gaz-System also is considering an investment in the floating storage and regasification unit (FSRU) in Gdańsk Bay, which would be used for reloading and bunkering LNG. At the same time, Poland’s major oil company, Lotos, will build a reloading facility in Gdańsk. That means Poland and Lithuania will compete for the same customers. On the other hand, it cannot be ruled out that a new terminal will be built in Latvia or Estonia, which would increase regional competition.

This smaller-scale LNG also creates opportunities for new markets. Infrastructure for bunkering and loading trucks is currently being built near Tallinn. Sweden has two small-scale import terminals, Finland has one but is building another three. Both countries are considering new investments. Germany abandoned a plan to build large LNG importing terminals, instead it will focus on the small-scale market and is planning to build five terminals serving that goal. At the same time, LNG usage in transportation is becoming more popular there.

The EU also supports new investments in Baltic Sea ports to promote LNG as a clean fuel. Russia Enters New Market. Russian companies have had little experience in the LNG sector so far. The only big export terminal, owned by Gazprom, is in the Russian Far East. However, Russia is consistently investing in LNG, including small-scale LNG. Access to cheap gas deposits and its supply chain, as well as experience, make Russia a strong competitor. After changes to laws lobbied for by Russian firm Novatek, the company has been granted a permit to export LNG.

Novatek’s Yamal LNG, with export capacity of 7 bcm, will be opened this year. It will export natural gas to Asia and Europe, which may increase supply and competition in the Baltic Sea region as well. There is strong demand for Novatek’s LNG and almost all capacity is booked for long-term supplies; however, some of the LNG will be sold on the spot market. In 2019, the terminal will be expanded and its export capacity will rise to 21 bcm. Gazprom’s import terminal in Kaliningrad will have capacity of 2.7 bcm and will be completed this year. So far, the Russian exclave has been receiving gas supplies via Lithuania and Belarus. However, an investment in a large export terminal, Baltic LNG in Leningrad Oblast, has been moved from 2018 to 2022–2023. Initially, it was set to supply Kaliningrad and Europe; however, pipelines and small-scale LNG deliveries are more competitive.

Gazprom, which for years has remained a gas export monopolist, must face not only a domestic competitor but also an LNG market that is flexible in terms of supply and prices. However, the company is adapting to the new reality and has already established cooperation with more experienced players (such as Fluxys and Gasunie) and is looking for domestic and foreign LNG buyers. Gazprom owns small-scale export terminals with capacities of 26–30 mcm in Kaliningrad, near St. Petersburg near the Estonian/Latvian border, and it is planning new ones.

Gazprom’s key objective on foreign markets is to enter the supply chain to supply LNG to end consumers. This strategy is used in Poland as well. Gazprom invests in LNG stations and public transport sectors there through its subsidiaries. At the beginning of 2016, Gazprom and its subsidiaries owned 86 LNG and CNG stations abroad, including 35 in Germany, 26 in Belarus, 10 in Czech Republic, and two in Poland. Much of the 28 mcm in small-scale LNG exports in 2015 went to Poland. Gazprom sends its natural gas in tanker trucks to Germany, Estonia and Czech Republic. Conclusions and Recommendations. The Polish and Lithuanian LNG terminals have increased the countries’ energy security and diversified their natural gas supply.

Competition between LNG exporters, flexible contracts, and lower prices have pushed both countries to use their terminals to maximize profit. The development of the LNG and small-scale LNG markets also stimulates new investments in the Baltic Sea region. Gazprom has been increasing its presence for some years now and is investing across the entire supply chain. It will be a heavyweight competitor; however, not as a monopolist but as a typical market player. It is finding its feet not only on the domestic market and in Germany but also in Poland. Poland should use the opportunities created by the new LNG market trends, including increased industrial gas consumption, LNG usage in maritime and road transport, as well as small-scale LNG. Both domestic and regional markets will offer new prospects for expansion. Poland needs to make significant investments to ensure its companies will be able to reach new customers. This is especially important considering that other companies from the region will join the race soon.

Sustainable Development Solutions Network
SDSN's May 2017 Newsletter!

Tsinghua University SDG Institute Launched
In collaboration with the SDSN the university has launched the first institute in China dedicated to the SDGs. The institute underscores China’s commitment to support the SDGs at national and international levels.

SDSN Northern Europe: Oceans Solutions Report
Released at the Solution Initiative Forum (SIF) Oceans in Gothenburg, Sweden, this compilation of innovative SDG 14 solutions focuses on four key areas: litter, energy, aquaculture, and pollution. The submitted ideas show that sustainable use of our ocean is indeed possible.
11th Meeting of the SDSN Leadership Council & T20 Summit
The Leadership Council meeting in Berlin, Germany, on 30 & 31 May was hosted by the German Ministry of Economic Cooperation and Development and the ESMT. It was organized in collaboration with the T20 Summit, which featured two SDSN-hosted side events on the role of religion in global problem solving and on the SDGs and oceans. The T20 and SDSN agreed to partner on future work on long-term transformation pathways. Professor Jeffrey Sachs delivered a passionate speech calling on all G20 countries to actively support the SDGs. SDSN's National and Regional network staff participated in a capacity building and training event with generous support from GIZ.
SDG Localization Event in the Andean Region
On 5 May, the Andean chapter of the SDSN held a high-level meeting of 23 SDSN member organizations and special guests. The event was hosted by the Secretariat of the Union of South American Nations (UNASUR), located in Quito, Ecuador.
SDG Academy: Launch of New Climate Action MOOC; Return of Two MOOC Favorites
On 19 June, the SDG Academy will launch its newest course, Climate Action: Solutions for a Changing Planet, on solutions to reduce global GHG emissions. Due to unprecedented popularity, they will also be bringing back the Sustainable Cities and One Planet – One Ocean MOOCs. Enroll by 31 May and 14 June, respectively.
Launch of the Amazon Solutions Platform
The SDSN Amazonia launched the Amazon Solutions Platform on 29 May at the Impact Hub Berlin. The platform aims to to geo-reference the best practices of regional stakeholders and promote local understanding of sustainable development.

SDSN in the Media

Marianne Beisheim: The G20 and the 2030 Agenda for Sustainable Development: How to Strengthen Policy Coherence and Accountability, SDSN – 23 May, 2017

Guido Schmidt-Traub: A Long-Term Transformation Pathways Initiative (LTTPI) for the G20, SDSN – 23 May, 2017

Antonio Pedro, et al.: Towards a sustainable development licence to operate for the extractive sector, Mineral Economics, Springer Link – 18 May, 2017

Shahid Naeem et al.: Organic Micropollutants in the Environment: Ecotoxicity Potential and Methods for Remediation, Springer Link – 11 May, 2017

Keyu Jin: How China is connecting the world, Euro News – 11 May, 2017

Jeffrey Sachs: China's Xi pledges to support Paris climate agreement, Aljazeera – 10 May, 2017

Hannah Fuchs: "Für mehr Transparenz auf der Klimakonferenz" (in German), Deutsche Welle – 10 May, 2017

Lydia Jakobi: "Verschmutzung, Überfischung, Todeszonen - den Meeren geht es schlecht" (in German), Mitteldeutscher Rundfunk – 10 May, 2017

Christian Mihatsch: "Das "CO₂-Gesetz" ist noch erfüllbar" (in German), Klimaretter Info – 7 May, 2017

Shaukat Aziz: It’s not government’s role to get involved in businesses, NINEOCLOCK – 5 May, 2017

Thomas Heller: Is Germany too successful? (in German), Money Cab – 5 May, 2017

Shahid Naeem: Climate extremes stress ecosystems, American Association for the Advancement of Science – 5 May, 2017

Hirokazu Yoshikawa, et al.: Children, Youth and Developmental Science in the 2015–2030 Global Sustainable Development Goals, Society for Research in Child Development, Social Policy Report – May 2017

Hirokazu Yoshikawa, et al.: Gay-Straight Alliances as settings to discuss health topics: individual and group factors associated with substance use, mental health, and sexual health discussions, Oxford University Press – May 2017

Jane Lubchenco, et al.: Designing a solution to enable agency-academic scientific collaboration for disasters, Ecology and Society – May 2017

James Hansen, et al.: Prospects for scaling up the contribution of index insurance to smallholder adaptation to climate risk, CCAFS Info note – May 2017

Martin Visbeck, et al.: Introduction A Framework For Understanding Sustainable Development Goal Interactions, International Council for Science – May 2017

Mariana Mazzucato and Douglas K.R. Robinson: Co-creating and directing Innovation Ecosystems? NASA's changing approach to public-private partnerships in low-earth orbit, Technological Forecasting and Social Change, Elsevier – 27 April, 2017

Jane Lubchenco et al.: Avoiding a crisis of motivation for ocean management under global environmental change, Global Change Biology, John Wiley & Sons – 27 April, 2017

Lan Xue et al.: Will China redefine development patterns in Africa? Evidence from Cameroon, Science Direct – 24 April, 2017

Mariana MazzucatoResponse to the Green Paper “Building our Industrial Strategy” – 1 April, 2017

Upcoming SDSN Events

SDG Academy Webinar: Meet Our Leaders: Achim Dobermann
1 June, 5:30-6:30 PM EST | Facebook livestream

High-Level Political Forum (HLPF)
5-9 June | New York

The Oceans Conference
5-9 June | New York

Ninth Annual Master’s in Development Practice (MDP) Program Summit
10-13 June | Universidad de los Andes, Bogota, Colombia

Partnerships to Pathways: Critical Collaborations in the Data Revolution 
15 June | New York

The Oceans: A Key to Sustainability
22 June 9:30 AM - 1:30 PM | Madrid, Spain

Caribbean SDGs
27-28 June, 2017 | Montego Bay, Jamaica
For more information or to join, please contact

Second Convening of Plastic Busters Project
29 June | Siena, Italy

View full list of Events

Other News and Events
  • ICSU and IIASA just released a report, “A Guide on SDG Interactions: From Science to Implementation,” on how to navigate and capitalize on interlinkages between the SDGs.
  • The SDG Academy is hiring for two open positions: Program Manager and Communications and Digital Media Manager.
  • deep decarbonization analysis and consultation for Washington State was completed last year by the U.S. DDPP team and is now available on the governor's office website.
  • SDSN Emeritus Leadership Council Member, Christiana Figueres, inspired thousands at ICAEW’s 100th Crowd Forum with her speech on “stubborn optimism.”
  • SDSN member Gaia Education, together with UNESCO Global Action Programme, is conducting a Training for Multipliers on community implementation of the UN’s Sustainable Development Goals.
  • After his visit to Yemen, the President of the Norwegian Refugee Aid, Jan Egeland, made an appeal for peace and aid in an area that is a “gigantic failure of international diplomacy.”
  • You are invited to submit abstracts for workshop contributions and scientific posters at the Impacts World 2017 (IW 2017) conference. Deadline: Thursday, 15 June.
  • SDG USA, a non-profit sister organization to SDSN, has launched its website outlining its goals, work, and structure.
Sechin Proposes Druzhba Extention

Rosneft wants to extend the southern leg of the Druzhba pipeline to the refineries in southern Germany in which it has stakes, chief executive Igor Sechin said in Berlin last week. The firm has shares in 210,000 b/d refiner Bayernoil and the 301,000 b/d Miro plant in Karlsruhe. Rosneft plans to invest around €600mn ($669mn) in its German assets over the next five years, Sechin said. The easiest route for crude deliveries to these refineries would be an extension of the 9mn t/yr (179,000 b/d) Druzhba leg to the Czech Republic. Rosneft and Tatneft supplied 1.2mn t — around 3.6mn t/yr — of Urals to Czech refineries through Druzhba in January-April and 3.4mn t last year. This suggests there is around 5.5mn t/yr of available capacity for supply to southern Germany — although Druzhba flows may rise in the second half of this year because of a scheduled reduction in Urals exports through the Baltic port of Primorsk.

But many market participants doubt that a Druzhba extension to Germany will be built — it could prove difficult to secure EU approval, they say, and the project would require significant investment from heavily indebted Rosneft. Theoretically, Urals could be supplied through the existing 10mn t/yr (200,000 b/d) Ingolstadt-Kralupy-Litvinov (IKL) link — connecting the Trans-Alpine pipeline (TAL), from the Italian Adriatic port of Trieste, with the Czech Republic’s two main refineries, which are in turn connected to the southern Druzhba leg.

But Polish oil firm PKN Orlen, which owns Czech refiner Unipetrol, would probably oppose the use of IKL to ship Urals to Germany, traders say. Unipetrol receives light sweet crude through TAL and IKL for its 63,000 b/d Kralupy plant, while its 103,000 b/d Litvinov refinery runs mainly Urals.

Rosneft has a 24pc stake in the Karlsruhe refinery, alongside Shell with 32.25pc, ExxonMobil holding 25pc and US independent refiner Phillips 66 with 18.75pc. And the Russian firm has a 25pc share in Bayernoil — which operates the neighbouring Vohburg and Neustadt refineries. The other shareholders in Bayernoil are Italian firm Eni with 20pc, BP holding 10pc, and a joint venture between trading company Vitol and investment group Carlyle, Varo Energy, with 45pc.

Mix and match Karlsruhe and Vohburg-Neustadt now receive different crude grades along the TAL route. Rosneft supplied 400,000t to Trieste in January-April — two 80,000t cargoes of Urals and three of Caspian CPC Blend. Of total Rosneft supplies of 2.35mn t last year, 430,000t was CPC Blend and the rest Urals — 1.22mn t from Novorossiysk and 700,000t from Baltic ports. Total crude deliveries to Trieste in the first four months of 2017 were about 1.9mn t of Urals and 4.68mn t of CPC Blend, and 4.77mn t and 9.74mn t, respectively, for full-year 2016.

Rosneft’s trading arm also supplies Libyan and Iraqi crude to the German refineries in which it has stakes. The Russian firm signed crude supply contracts in February with Iraq’s semi-autonomous Kurdistan region, for deliveries in 2017-19, and with Libyan state-owned oil company NOC. The first 80,000t Libyan cargo was delivered to Trieste in late February and a similar amount of Iraqi crude in April, market participants say. Rosneft will mainly send the Libyan and Iraqi crude to its refining assets in Germany, traders say.


VN proposes ASEAN-China hotline for sea disputes
Update: June, 05/2017 

SINGAPORE  – Việt Nam has stressed the need for ASEAN and China to implement the Code for Unplanned Encounters at Sea (CEUS) and operate a diplomatic hotline to settle problems at sea in an effective manner to avoid disputes from flaring up.

Addressing the fourth special discussion held in Singapore on Saturday on practical measures to prevent encounters at sea, the Deputy Minister of Public Security, Senior Lieutenant General Bùi Văn Nam, also said that a state must not find excuses to ignore requests sent through the hotline to settle incidents at sea.

Nam told the meeting, held as part of the 16th Shangri-La Dialogue, that the CUES must apply to all government vessels operating in the East Sea, including military and semi-military ships.

ASEAN and China should work together for the early formation of a Code of Conduct in the East Sea (COC) which is binding, comprehensive, practical and acts as an effective tool to prevent disputes and maintain peace, stability, navigation and over-flight security and safety, he said.

Meanwhile, all countries should foster co-operation in less sensitive areas at sea, including scientific research, maritime environment protection, natural disaster prevention and search and rescue operations.

They should also collaborate against terrorism, piracy, human trafficking and illegal migration, thus strengthening mutual understanding and minimising actions that may lead to misunderstanding and disputes, he said.

The enhancement of partnerships at sea must be in line with full and strict implementation of international law, especially the UN Convention on the Law of the Sea 1982 (UNCLOS) and other regional agreements, he said.

He added that this should be done on the basis of respect for sovereignty and interest of other countries, ensuring the voluntary and responsible engagement of all sides for mutual interest and benefit.

Nam also said that the international community should consider the establishment of a mechanism to gather and connect articles in existing international conventions and supplementing new ones to build shared codes of conduct and make collective interventions when unexpected situations arise at sea.

A comprehensive legal framework will help improve responsibility to implement international legal regulations and reduce the risks of disputes at sea, he said.

Nam affirmed Viet Nam’s commitment to actively cooperate with ASEAN members and other states within and outside the region through regional and international forums such as the ASEAN, East Asia Summit, the ASEAN Defence Ministers’ Meeting Plus, and the ASEAN Regional Forum (ARF).

He said this would help build trust and realise preventive diplomatic measures to minimise risks of encounters and disputes at sea.

Việt Nam supports all initiatives and co-operation mechanisms for maintaining peace and stability, and for promoting the peaceful settlement of disputes at sea on the basis of international law, he reiterated.

The Deputy Minister further said that Viet Nam supports the implementation of co-operation initiatives and projects at sea based on observing relevant international law and agreements, respecting and harmonising the interests of all sides.

The nation also backs stepped-up information exchange and co-ordination between governments, international organisations, experts and scholars on the sea and ocean, he said.

Other participants also agreed that in order to handle disputes at sea, all parties should reach a joint perspective and not complicate the situation, and settle all issues through peaceful measures.

Earlier the same day, three special discussions were held on nuclear dangers in the region, new methods in security partnership and the defence implications of new technology. — VNS