Leading European gas lobbyists reject call to back EU plans to quit Russian gas

Eurogas represents over sixty of Europe’s biggest gas companies and wields significant influence over European energy policy. The group’s lobbyists hold nine passes to the European Parliament and EU Energy Commissioner Kadri Simson was scheduled to rub shoulders with their members at their annual conference earlier in mid-March.

 When we asked if it supported the EU's proposal to move off all Russian gas by 2027, Eurogas failed to say they supported the proposal, saying only that they were 'analysing' the proposal, but 'fully support' the objectives on hydrogen and biomethane.

Eurogas’ has long been closely tied to senior Russian officials and gas companies. Since 2006 Eurogas has represented a Russian gas association led by Russia’s top energy lawmaker who may face sanctions from the European Union.

The Russian Gas Society’s President is Pavel Zavalny, a prominent lawmaker from Vladimir Putin’s ruling United Russia party. Zavalny is the Chairman of the Energy Committee in Russia’s State Duma, the lower parliamentary house.

The presence of a high-profile Russian lawmaker did not appear to have deterred Eurogas from continuing to welcome the Russian Gas Society. The group had been listed among the members of Eurogas on its website alongside gas majors like Shell, Total and Eni until it was quietly removed in March. Eurogas’ Secretary General James Watson told us that the Russian Gas Society’s membership was suspended on the 4th of March this year.

In the lead up to Russia's invasion of Ukraine, Zavalny publicly claimed to have voted for the State Duma’s resolution recognising the two self-proclaimed Donetsk and Luhansk republics in Eastern Ukraine. Zavalny noted in Instagram posts that he had recently been self-isolating with Covid but stated that he voted in favour of the resolution, though public records from the State Duma website list him as not having voted for any bills on that date.

The European Union announced sanctions on 351 Russia lawmakers who voted in favour of the resolution, though Zavalny’s name has not yet appeared in the lists of sanctioned individuals.

Zavalny has publicly echoed the Kremlin line justifying the invasion, which he referred to as “The special military operation” on his VK social media page saying “Our task is to enforce peace.” Zavalny voted in favour of the “fake news” law passed in early March threatening up to fifteen year jail terms reporting about the Russian military deemed “false”.  Following economic sanctions imposed on Russia Zavalny also accused the US, EU and UK of “economic and financial terrorism”.

Zavalny and the Russian Gas Society did not respond to requests for comment.

Like many of his colleagues at the Russian Gas Society Zavalny is a veteran of Gazprom, Russia’s state-owned gas giant. Zavalny is the former General Manager of Gazprom’s major subsidiary Tyumentransgaz. Other senior figures in the Russian Gas Society’s management include Markelov Vitaly Anatolievich, a current member of Gazprom’s board of directors and Shamsuarov Azat Angamovich, First Vice President of Lukoil. The group’s Executive Director Isakov Nikolay Vasilievich, in addition to having credentials as a former Gazprom executive lists his work experience as a Lieutenant General of the Armed Forces of the Russian Federation. 

Gazprom has been sanctioned by the US, Canada and the UK in recent weeks.

The Russian Gas Society is not a mere bystander within Eurogas. The group proudly advertised its association with Eurogas, prominently displaying Eurogas’ logo across its website and explaining that “In order to most effectively broadcast the positions of the companies that are members of the Russian Gas Society” its representatives took part in a dozen different Eurogas committees, working groups and projects including its strategy and finance committees and its gas advocacy working group.

The Russian Gas Society’s website has also been altered to remove references to Eurogas.

Eurogas’ Watson told us that the Russian Gas Society, as an associate member of Eurogas, was not part of the group’s formal decision-making bodies, claiming that without voting rights “it could at no time actively influence Eurogas decision making.”

Eurogas has not been alone in representing Russian oil and gas companies, Gas Infrastructure Europe (GIE), another lobbying group representing gas companies, also still counts Gazprom’s German subsidiaries Gazprom Germania and Astora among its members.

Both companies are wholly owned by Gazprom which supplies around 40% of Germany’s fossil gas imports. Astora manages a quarter of Germany’s gas storage and operates facilities across Germany and Austria.

Since the outbreak of war several jurisdictions have imposed sanctions against Gazprom. The EU has banned any transaction with Gazprom, albeit with several exemptions including the purchase and transportation of fossil fuels into the EU.

In response to questions about Gazprom’s membership, GIE Secretary General Boyana Achovski stated that energy and gas are currently exempted from sanctions. Like Eurogas she also did not support the plan for ending Europe’s dependence on Russian gas, instead emphasising GIE members ability to diversify sources of gas. She added that “GIE does not represent the entities who buy/sell gas. Thus, GIE does not decide where gas is coming from” and “the regulated part of our infrastructure has a legal obligation to transport or store for licensed shippers.”

Given the speed with which other European companies have cut ties and business relationships with huge swathes of the Russian economy in the wake of the invasion of Ukraine, it is remarkable that GIE still represents the interests of a firm so closely tied to Putin and the Russian state.

The Russian Gas Society also proudly touted its membership of the International Gas Union, a global gas industry lobbying organisation which still lists the group as an associate member.

Eurogas’ stated aims include promoting the role of gas in Europe, including promoting switching from coal to fossil gas as opposed to shifting directly onto renewable energy sources.

70% of Russia’s gas is exported to Europe, filling nearly 40% of Europe’s gas demand. A third of Russia’s government income comes from oil and gas. 

European gas companies have depended on a growing flow of Russian gas to fill their pipelines and fuel their power plants. The fossil gas industry has continued to argue for expanding Europe’s gas infrastructure, locking in Europe’s gas habit for decades to come, despite the geopolitical implications of Russia being Europe’s largest gas supplier. 

This co-dependence has meant that the European gas industry’s goals have long been closely aligned with the interests of the Russian state.

Major international oil and gas companies like Eurogas members Shell and Total have long held significant investments in the Russian gas industry. In recent weeks some major companies including Shell and BP have said they plan to sell their Russian ventures while others like Total have only announced that they would limit new investments.

Russia’s disruption of gas supplies through Ukraine in 2006 and 2009 and the annexation of Crimea in 2014 prompted European decision makers to call for diversifying the continent’s gas supply so Europe would be less dependent on Russian oil and gas.

Europe has ploughed subsidies and political support into new gas infrastructure. The EU has handed over €4.662 billion in subsidised grants and loans to help build new gas projects like pipelines and import terminals since 2013. This is despite the EU’s climate targets needing significant reductions in the use of fossil fuels including gas.

Gas companies backed new pipelines to import Russian gas. The controversial Nordstream 2 pipeline, designed to bring more Russian gas to Germany while bypassing Ukraine, was owned by Gazprom but financed by Eurogas members Engie, Shell, Uniper and Wintershall together with Austrian energy group OMV. The project was also promoted by Zavalny as part of official Russian delegations. 

The pipeline was only halted after the Russian Duma, apparently including Zavalny, voted to recognise the Ukrainian separatist regions ahead of Russia’s invasion.

This diversification strategy has been a failure. European demand for fossil gas has increased and the continent's dependence on Russian gas has only grown. Zavalny himself explained that in 2005 “our share was 26% of total imports. Fifteen years later, it went up to 40%”.

The opportunity was missed to reduce Europe’s dependence on fossil fuels through energy efficiency, renovations of buildings and installing more renewable energy capacity. 

Eurogas has had significant reach in EU policy making circles. EU Energy Commissioner Kadri Simson was scheduled to speak at the group’s annual conference in mid-March, though it has been postponed following the outbreak of war. Simson and Frans Timmermans, the EU Executive Vice-President in charge of the European Green Deal, have spoken at their annual conference the last two years. 

Eurogas has nine lobbyists with passes to the European parliament, has secured over 50 meetings with EU Commission officials since 2014 and holds seats in several expert groups that advise the Commission.

Eurogas’ arguments in favour of funding yet more gas infrastructure projects were echoed by prominent MEPs in a recent revision of legislation setting the process for distributing subsidies and fast-tracked approvals. Eurogas’ proposed language was even incorporated into legislation agreed by the Parliament word for word in some cases.

Eurogas Secretary General James Watson explained his strategy in lobbying the EU Commission to EUObserver saying "I think it is inevitable that they also look outside for external support, not just from lobbyists, but also from think tanks, from universities," he continued "I don't think they have any choice. They simply don't have the resources to behave like a national government".

The gas industry, including Eurogas, has heavily promoted the possibilities of “decarbonised gases”, like hydrogen or biomethane. These gases would still flow through Europe’s existing or retrofitted gas infrastructure allowing many gas companies to maintain their business model for decades to come. 

These alternative gases, while likely to be essential in decarbonising some sectors, have major drawbacks with limited and costly supply and significant environmental concerns. We have shown claims around hydrogen made from fossil gas, known as grey hydrogen or blue hydrogen if some of the emissions are captured, are often merely fossil fuel industry greenwash.

The dream of greener gases in the future has been used by lobbyists like Eurogas to delay conversations about decommissioning Europe’s sprawling network of fossil gas infrastructure, instead it has been used to justify the building of yet more gas projects even when we know we need to be rapidly phasing out our use of fossil gas.

Eurogas’ James Watson told us that they “support the full decarbonisation of our sector well before 2050” and they support the European Commission’s on “objectives on biomethane and renewable hydrogen”

GIE told us that “New European investments in gas infrastructure will be needed to strengthen further the security of supply by increasing market interconnection, import terminals, storage capacity, grid interoperability and flexibility and to provide grid access for more low-carbon and renewable gasses.” Adding that their focus with regard to renewable infrastructure “is on converting existing infrastructure for re-use, and only if necessary on building new infrastructure.”

Both European and Russian gas companies have seized on the potential money-making possibilities of selling these new gases though. Gazprom announced in 2021 that Russia would be the world's largest exporter of blue hydrogen by 2030. Eurogas’ President Didier Holleaux announced in October 2021 that his company, the French gas group Engie, was keen to collaborate with Russian partners to produce hydrogen in Russia. Engie has been buying 20% of its gas supply from Gazprom.

Europe’s dependence on Russian gas long tied Europe’s hands in its dealings with Putin. We are calling for sanctions against the Russian fossil fuel industry, to ensure no further funds flow into the Russian war chest through oil, gas and coal.

In parallel, Governments must roll out a vast package of support to ensure that this crisis does not drive millions more into energy poverty. Governments should also urgently support the installation of home insulation, renovation of buildings and increasing renewable energy generation.

Europe has listened to the gas industry, rather than prioritising tackling the intersecting crises of the climate crisis, energy poverty and Russian aggression. This needs to stop if we are to phase out Russian gas as well as other fossil fuels.

Eurogas happily represented the interests of the Russian Gas Society, for 16 years. Their actions in recent days to suspend the group does not change that their aims of promoting Europe’s dependence on gas can still be seen as closely aligned with Russia’s.

If it were not for the invasion of Ukraine, Europe’s most senior energy official would have been gladhanding Pavel Zavelny and other lobbyists at Eurogas’ conference in March, just as EU officials rub shoulders with fossil fuel lobbyists every week at sponsored speaking events, expert group consultations and private lobbying meetings.

We need to move to a fossil free future and that means dismantling the fossil fuel industry and their influence on our politics.

As a society we have faced this problem before. In 2005 a global treaty addressed what it called “a fundamental and irreconcilable conflict between the tobacco industry’s interests and public health policy interest". The treaty established rules barring tobacco companies from influencing public health decision making. The European Union is among the treaty’s signatories.

The time has come for a similar firewall to be placed between fossil fuel companies and public officials. We need a fossil free politics where EU officials refuse to meet the fossil fuel industry. That means no lobby meetings, no seats in expert and advisory bodies and no speaking engagements at fossil industry sponsored events.

At moments of crisis, Europe has a choice to take action it has long delayed. The interests of Putin’s regime and the fossil fuel industry must be rejected so we can have a future that is sustainable, just and peaceful.

Update: Following the publication of this article Gazprom announced it would terminate its participation in Gazprom Germania and the company was taken over a German regulator.