In addition, Europe’s production is declining steadily, and the UK is now a net importer of gas. More of the North Sea’s remaining gas output will also need to be injected into its oil fields to prolong their output, decreasing the amount left for business and consumers. According to Poynter, this will create an additional deficit of some 50 billion cubic metres a year by 2020, bringing the total shortfall to 200 billion cubic metres, or about one-third of current European consumption.

While LNG shipments – which can be accessed on a short-term, or “spot”, basis from suppliers around the world – may provide an answer in the immediate future, they are a very costly way to import gas. Huge new terminals have to be built in the producing countries to cool and compress the raw gas into liquid form prior to shipment in expensive LNG carriers. Then, special ports and processing plants to convert the liquid back to gas, ready for distribution in national gas grids, have to be constructed in the consuming countries.

Environmental campaigners, worried about the potential damage such facilities can cause to marine and wildlife, have mounted protests. While experts say LNG is highly unlikely to explode, residents and workers within a one-mile radius near the ports and re-gas facilities could be endangered if the gas were to leak into any confined space

In any case, both Poynter and Forbes note, few of the new LNG facilities being built in Europe have obtained medium- or long-term gas supply contracts. LNG supplies look “very uncertain” beyond 2011, Forbes says, despite the construction of new terminals in Algeria, Angola, Peru and Australia. “It is a pretty bleak picture,” adds Forbes.

For this reason, the EU’s new strategy places far greater emphasis on building pipelines to reach Europe, particularly south-eastern areas where the shortages are expected to be most acute. Pipelines are also far cheaper, both for energy companies and consumers, as well as less damaging than LNG. While there is always the risk of an accidental or purposeful attack on a pipe, the effects are unlikely to disrupt supply for long, industry analysts point out.

Spain is already connected, via links under the Mediterranean, to Algeria, and Italy to Tunisia and Libya, via Sicily. Gas from Russia’s Urals is piped to northern Europe via Ukraine, Belarus and Poland. Work on a new 1,200km sub-sea line, Nord Stream, which will cross the Baltic to northern Germany, is due to begin in 2010. Exports from Turkmenistan and Kazakhstan are transported via a pipeline running along the eastern shore of the Caspian Sea through Russia to Ukraine and the Black Sea, while Azerbaijan’s travel through a landline across Georgia and the Caucasus to south-eastern Turkey. Europe’s own production in the North Sea is transported via sub-sea pipelines to the UK, Norway, Denmark, the Netherlands, Germany, Belgium and France.

To fill the yawning gap in south-eastern Europe, the EU, backed by the US, has thrown its weight behind a pan-European consortium headed by Austria’s OMV which is planning to build a new 3,300km pipeline that will run from Turkey through Bulgaria, Romania and Hungary to a central European hub located at Baumgarten, near Vienna. Dubbed Nabucco in the industry, EU officials are also hoping that it will be connected to the new Arab Gas Pipeline that links Egypt’s gas fields with Jordan, Syria and Lebanon and which may be extended to Iraq, where there are vast new gas fields to develop. The line is to have an initial capacity of 10-12 billion cubic metres when completed in 2012 or 2013, rising eventually to 31 billion cubic metres.

Doubts are growing, however, that Nabucco will be commercially viable, especially as it is seen as a competitor to the 930km, €10bn South Stream pipeline which is to be built from Russia to the Balkans and Greece with a planned extension to Italy. A 50/50 joint venture between Gazprom and Italy’s Eni, former president Vladimir Putin has persuaded Bulgaria, Serbia, Hungary, Greece and Italy to participate. The line could bring up to 30 billion cubic metres of gas a year from Russia to Europe by 2013.

There is also the question of “where the gas is to come from for Nabucco,” says Forbes. There are still difficult legal issues to resolve if supplies from Turkmenistan and the Caspian Sea are to be obtained, he says. Azerbaijan’s own needs are growing at home, reducing its export potential. Egypt “is running into gas shortages. Iraq is a definite possibility,” he adds, “but the politics is fraught. A lot of holes are being drilled in Libya, but nothing much has been found so far.”

When Nabucco was first proposed, Forbes adds, it envisaged supplies coming from Iran. “That was the main idea.” But with the EU and the US concerned about Iran’s nuclear programme that is now seen, at best, as a long-term proposition. “I see Nabucco being fed by Iran,” the EU’s Piebalgs said at the end of March. “But I also see that it could be achieved only after solutions are found for the [nuclear] enrichment facilities in Iran.”

Without Nabucco, there could be a big dent in the EU’s policy of diversifying supplies away from Russia. Should we be worried?

“No,” says one of the energy industry’s most respected commentators, Robert Mabro CBE, the founder and honourary president of the Oxford Institute for Energy Studies. “The EU bureaucracy in Brussels…the British, French, Italian and Polish governments… they have turned Russia into a monster.” They “misunderstood what happened between Russia and Ukraine. They forgot… that if you…don’t have storage…you have no cushion if there is an interruption for any reason. You don’t have a buffer.”

The EU’s attempt to get away from Russia, he argued, “is identical to the US discourse, ‘We want to be free from the Middle East.’ They have been saying it for 40 years and they don’t even have the decency to realise it’s a nonsense.”

In other words, we live in an interdependent world, and Russia, as many in the industry and in some EU governments point out, is as dependent on Europe as a market for its energy exports as we are on their exports. Besides, it appears, Europeans are willing to pay more for Russian gas than the Chinese.