Monday, June 12, 2006


St Petersburg - G8 Finance Ministers

Russia is prepared to sign a revised Energy Charter Treaty. This development was suggested at the weekend's meeting of G8 Finance Ministers. Energy Security

[Russia] agreed, for the first time, to the inclusion in the final communiqué of a reference to the Energy Charter - a development hailed as "major progress" by Thierry Breton, French finance minister. The charter, a legal document signed but not ratified by Russia, requires it to open up access to its pipelines for other countries.

[However Russia] disagreed with the charter's present form. [Russia's Finance Minister] said the document was out of date and needed to be changed to include nuclear energy and redefine rules of transit and investment.

[Moreover, the Minister] reiterated that Russia was a reliable supplier of energy, but turned the tables on consumers of Russian energy, saying they bore as much responsibility for energy security as did the producer. He said energy producers needed "the security of demand" to justify investment in production. "We have quite stable growth of energy supply, but we are encountering a demand shock."

The full Energy Charter Treaty can be read here. The introduction is here.

The Treaty’s provisions focus on five broad areas: the protection and promotion of foreign energy investments, based on the extension of national treatment, or most-favoured nation treatment (whichever is more favourable); free trade in energy materials, products and energy-related equipment, based on WTO rules; freedom of energy transit through pipelines and grids; reducing the negative environmental impact of the energy cycle through improving energy efficiency; and mechanisms for the resolution of State-to-State or Investor-to-State disputes.
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