Putin plays the power card (again) in the Balkans

There were high level discussions and agreements made in Moscow on Friday when Serbian President Boris Tadic and Prime Minister Vojislav Kostunica met President Putin and Russian Minister for Fuel and Energy Viktor Khristenko as well as Directors of Gazprom.

The agreements involved cooperation in the oil and gas sector, as well as a protocol specifying the main terms for Russian company Gazprom Neft would obtain 51% of Serbia's state oil company NIS. WaPo says Serbian Energy Minister Aleksandar Popovic confirmed reports that Russia had offered US$600 million -- about one-fifth of the company's estimated market value plus an additional US$730 million to modernize the run-down company.

Under a package deal, apart from the Gazprom / NIS deal a segment of the South Stream gas pipeline just agreed with Bulgaria will transit Serbia and on to to the Bosnian Serb Republic, Croatia and Italy ; construction of the huge Banatski Dvor underground gas storage with the capacity of about 800 million cubic meters will be completed costing some Euros 128 Mn. (See plans for NSI here by Dr. Svetislav Krstic pdf alert)

This whole shindig was a pivotal exercise in Balkan real politik and Putin's Russia, leveraging power through it's energy policy. The pro western Democratic Party faction in nationalist Kostunica's Cabinet, dropped opposition to the deal, ( a view supported by Isvestiya on Friday) needing the Prime Ministers support for incumbent President Boris Tadic, (he is allowed 2 x 5 yr terms) to defeat an ultranationalist challenger Tomislav Nikolic, the deputy leader of the hard-line nationalist Serbian Radical Party, in the country's runoff presidential vote on Feb. 3rd. Nikolic has in the past called for military intervention in Kosovo if it becomes independent and splits from (Greater) Serbia - he also would refuse to hand over fugitives such as Radovan Karadzic and Ratko Mladic.

The agreements also reflect the joint Russian / Serb opposition to a western supported independence for Kosovo. (Even though Tadic is said to advocate closer ties with the EU)

"Serbia very deeply respects the position of Russia on Kosovo," Tadic publicly told Putin. "We will defend our interests in Kosovo, operating on the basis of international law, and we will never do otherwise."

Putin was, as usual boastfully pushing Russian interests, and to please the public, resolute ; "Russia is categorically against a unilateral declaration of independence for Kosovo," he said, adding that it could "seriously damage the system of international law and have negative consequences for the Balkans and affect stability in other regions." ( Sub text "Watch it you unruly Ossetians")

Russia has historical, cultural, religious and linguistic ties with Serbia , they threatened a veto last year in the U.N. Security Council to block a Western-backed plan for internationally supervised statehood for Kosovo.

Ruairi OConnell our man in Pristina's blog has been brought to readers attention before ... his naive ramblings make one wonder how he will deal with these pesky Russki's..

.."We have to deal with the situation as best we can. And we do have to deal with it, right now; this is vital for European Security, but, most importantly of all, to give all the people of Kosovo a hope for a better life." ... and presumably a supply of natural gas.

See : Guradian U.S. worried about Russia's Balkan energy grab (Reuters) Friday January 25 2008

"A confidential Serbian government document obtained by Reuters said Washington was considering using diplomatic channels to express its concern at the deal and point out the shortcomings. "

"The U.S. side warned about the political influence Moscow would gain by controlling energy resources in Serbia and the region, and expressed a negative assessment about the economic justification of South Stream," said the transcript of a high level meeting between U.S. and Serbian officials in Belgrade."

And Reuters also had a high level contact ...

A State Department spokesman told Reuters via telephone from Washington that the U.S. continued to view Nabucco as the best scheme to provide energy diversification in Europe......"the best option for achieving European energy diversification, particularly with regard to providing a direct route to Europe for Caspian and central Asian gas supplies".

What NU Labour spinners would call ..er... an ..er .. "aspirational" view. What less well equipped might describe as being outflanked and those who express their political views more directly...er.."Fucked"

UPDATE 28/1/08

MOSCOW, January 22 (RIA Novosti) - The flagship of Russia's Black Sea Fleet has effectively engaged a designated target with a supersonic cruise missile as part of a Navy exercise in the northern Atlantic, a Navy spokesman said Tuesday.

The Moskva guided-missile cruiser launched the P-500 Bazalt (NATO reporting name SS-N-12 Sandbox), a liquid-propellant supersonic cruise missile, last used in 2003.

The P-500 Bazalt, which entered service in 1973, has a 550 km range and a payload of 1,000 kg, enabling it to carry a 350 kT nuclear or a 950kg semi-armor-piercing high explosive warhead.