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Moldova's Reliance On Russia, Transdniester For Energy Seen As Risky

A pumping station for a Moldovan-Romanian gas pipeline in Zagarancea
A pumping station for a Moldovan-Romanian gas pipeline in Zagarancea

WASHINGTON -- Moldova is among the most vulnerable countries in the world in terms of energy security, with protracted conflicts in Transdniester and Ukraine potentially putting it in a perilous position, an expert on the region says.

Lyndon Allin, an associate at Baker McKenzie, told a conference on July 13 that of total energy consumption in the former Soviet republic, 98 percent is imported, most of it from Russia, and the imports are transported through the breakaway Moldovan region of Transdniester

Of Moldova's electricity usage, 70 percent is generated in Transdniester, said Allin, who served with the Organization for Security and Cooperation in Europe's mission to Moldova.

"That's quite some challenge for the folks in Chisinau to ensure that they're able to keep the gas fired and keep the lights on," he said.

Transdniester is a breakaway area that is not under the control of the Chisinau authorities. It declared independence in 1992 and has received economic, political, and military support from Moscow ever since.

Allin, speaking at the Energy (In)security In Russia’s Periphery conference sponsored by the U.S. Commission on Security and Cooperation in Europe, cited statistics placing Moldova as the ninth-most-risky country in terms of short-term energy security.

He said Moldova was heavily reliant on Russian natural-gas giant Gazprom, which sends its supplies through Transdniester.

Allin said Gazprom had been supplying gas to Transdniester through the same pipeline, but had not been requiring payment, as a means of subsidizing the separatists against Chisinau, leaving an unpaid debt of some $6 billion.

However, should Russia ever want to put pressure on Moldova to prevent a tilt toward the West, Gazprom could theoretically decide to collect that debt from Moldova, although it is disputed who actually owes the money.

As it stands, Gazprom at this time would be hesitant to cut off supplies to Moldova because many of its customers are downstream from the country, meaning it would lose revenue if it tried to punish Moldova.

However, Allin said, once alternative pipelines -- Nordstream 2 and Turk Stream -- are completed, supplies could be sent westward without passing through Moldova, making the country’s energy security even more precarious.

One option being explored to relieve Moldova’s reliance on Russia and Transdniester is a gas interconnector with Romania, although that system is not currently able to come close to meeting Moldova's needs.

The European Union, the European Bank for Reconstruction and Development, and the European Investment Bank are providing about $105 million in financing for a gas pipeline from Romania to Chisinau in hopes of increasing capacity to get gas from Romania.

Another possibilities being explored is the possible exploitation of shale-gas supplies in the country, Allin said, citing an agreement by the Moldovan government in January 2017 with a U.S. company, Frontera Resources, to explore its development.

Hydropower is also a possibility, Allin said, although the Dubasari hydroelectric dam is inside of Transdniester and, so far, Moldova does not benefit from its production.

And, he said, there is also a plan to connect to the Romanian electricity grid, but technical and cost challenges have slowed that development.

Ukraine does supply some Moldovan electricity, he said. But he noted that most of the transmission lines go through Transdniester, which in theory could in the future cut the lines.

In conclusion, he said, "In Moldova...there needs to be more of an effort to solve 'own' problems and not look only to foreign partners for solutions."

"Funding, sure...advice, sure...but there is a fatigue level with folks not solving their own problems, while recognizing that these are difficult problems."

Moldova has been courted by the West as well as Russia. Its current president is Igor Dodon, the pro-Russian leader of the Socialist Party.

However, the country is divided, and Dodon has clashed repeatedly with the West-leaning government over ties with Russia.

While the government has said it wants to join the EU and NATO, Dodon has opposed membership and said he would like to cancel Moldova's EU Association Agreement.

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