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Kemp: BP Acknowledges US Shale Is Different

More LONDON, March 5 (Reuters) – Asking petroleum engineers and managers used to working offshore and on complex engineering megaprojects, the equivalent of building Ferraris, to start developing shale plays, the equivalent of building VW Golfs, was never going to work. BP’s decision to form a separate business to manage its onshore oil and gas assets in the U.S. Lower 48 states acknowledges shale production is more like a manufacturing process than traditional petroleum exploration. Shifting onshore assets into a separate business unit could pave the way for an eventual sale if their financial performance does not improve, as the Financial Times explains ("BP creates new U.S. onshore oil and gas business" March 4). The company’s chief executive insisted the assets would "remain a critical part of BP’s portfolio" though he admitted the reorganisation "creates optionality for us". But focusing too much on the possibility of an eventual sale […]

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The Changing Landscape of North American Gas is Regulatory Policies

The changing landscape of the North American unconventional gas is causing the industry and forcing the federal government to examine how to best regulate the business, a panel discussed Wednesday at IHS CERAWeek. “The economic benefits of natural gas is substantial,” stated Marvin Odum, president of Shell Oil Company, “the environmental benefits of creating natural gas is a topic that is often debatable between the industry and some communities.” As the production of natural gas increasingly plays a vital role in North America’s energy future, the environmental impacts and regulatory safeguards are viewed as major challenges and is a process that the industry fine tunes as it moves forward, commented Odum. Both state and federal government continue to develop and strengthen regulations to address some of these impacts, the panel stated, but the two major concerns from a citizen standpoint are air pollution and methane emissions, […]

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EU weighs Russia sanctions as Ukraine diplomacy falters

European Union leaders were set to warn but not sanction Russia on Thursday over its military intervention in Ukraine after Moscow rebuffed Western diplomatic efforts to persuade it to pull forces in Crimea back to their bases. Russian Foreign Minister Sergei Lavrov refused to meet his new Ukrainian counterpart or to launch a "contact group" to seek a solution to the crisis at talks in Paris on Wednesday despite arm-twisting by U.S. Secretary of State John Kerry and European colleagues. The two men will meet again in Rome on Thursday. Tension remained high in Ukraine’s southern Crimea region, where a senior United Nations envoy was surrounded by a pro-Russian crowd, threatened and forced to get back on his plane and leave the country. An emergency EU summit in Brussels is unlikely to adopt more than symbolic measures against Russia, Europe’s biggest gas supplier, because neither industrial […]

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EU to Weigh Ukraine Sanctions, Russia Spurns Diplomacy

European Union leaders will consider repercussions for Russia at an emergency meeting today on the Ukraine crisis, after Russia’s foreign minister fended off a U.S. effort to ease tensions in the Crimean peninsula. German Chancellor Angela Merkel and U.K. Prime Minister David Cameron will participate in today’s meeting in Brussels, a day after the 28-nation bloc offered 1.6 billion euros ($2.2 billion) in emergency aid to help the new Ukrainian government avert a default. The government is prepared to immediately sign the EU association agreement that ousted President Viktor Yanukovych rejected, precipitating the crisis, premier Arseniy Yatsenyuk said in an interview with newspaper Rzeczpospolita. Western nations including the U.S. are threatening Russia with sanctions over its military intervention in Crimea while pursuing diplomacy in an effort to defuse the crisis. Russia has accused the West of supporting a coup against Yanukovych and rejected EU proposals to broker a settlement. […]

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Europe Relies Less on Russian Gas Than Before

FRANKFURT—The Crimea conflict highlights anew Europe’s reliance on Russian gas, but compared with disputes of the past decade that cut fuel supplies, European countries are now better prepared to weather a showdown. Russia, which over the weekend sparked Western ire by occupying the Crimea region of Ukraine, supplies about 30% of the European Union’s gas by volume, according to Gazprom , the Russian state-controlled gas company. About half of Russia’s gas bound for Europe flows through Ukraine. But those flows halted in 2006 and 2009 amid financial disputes between Moscow and Kiev, with each side blaming the other. During that last spat, gas price soared across Europe and many countries faced shortages. Today, Europe is better prepared to withstand any supply disruptions, experts say. The Continent’s weak economy, new gas pipelines and changing energy policies have weakened demand for fuel and diversified supply routes. Europe today is awash with […]

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Ukraine to face consequences for unpaid gas debt

Russian Prime Minister Dmitry Medvedev warned Ukraine there would be "adverse consequences" should it not settle its outstanding gas debt. "[Anyone] who fails to pay for the supplied goods should be aware that it is fraught with adverse consequences, including those related to the revocation of previously reached agreements on beneficial terms of supplies," the former Russian president said Tuesday. In 2009, Russian energy company Gazprom cut gas supplies to Ukraine because of contractual disputes. That left European nations without a reliable source of natural gas as most of their supplies from Russia pass through the Soviet-era pipeline network in Ukraine. Ukraine last year secured relief from its debt obligations by way of a discount for purchased volumes. Gazprom Chairman Alexei Miller said the discount will be suspended in April unless Ukraine settles its outstanding debt from 2013. Miller said Ukraine paid "a little […]

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U.S. Effort to Broker Russia-Ukraine Diplomacy Fails

An effort by the United States to broker the first face-to-face diplomatic meeting between Russia and Ukraine over the Crimea crisis failed on Wednesday, but Secretary of State John Kerry and his Russian counterpart announced more discussions in the days ahead. Their remarks left open the possibility of progress toward a solution to de-escalate one of the most serious East-West confrontations since the Cold War. But while Mr. Kerry asserted Wednesday night that his deliberations here had yielded creative ideas and that he planned to resume talks with the Russian foreign minister in Rome on Thursday, there were also signs of how acute the crisis remained. Continue reading the main story In Crimea, unidentified armed men threatened the United Nations special envoy, Robert Serry, forcing […]

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U.S. Hopes Boom in Natural Gas Can Curb Putin

The crisis in Crimea is heralding the rise of a new era of American energy diplomacy, as the Obama administration tries to deploy the vast new supply of natural gas in the United States as a weapon to undercut the influence of the Russian president, Vladimir V. Putin, over Ukraine and Europe. The crisis has escalated a State Department initiative to use a new boom in American natural gas supplies as a lever against Russia, which supplies 60 percent of Ukraine’s natural gas and has a history of cutting off the supply during conflicts. This week, Gazprom, Russia’s state-run natural gas company, said it would no longer provide gas at a discount rate to Ukraine, […]

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Putin putting Europe in its place

How the situation in Ukraine may appear if viewed through the Russian leader’s eyes European leaders meet on Thursday to discuss their response to Russia’s effective invasion of Crimea . Vladimir Putin ’s closest allies were last night looking for a face-saving gesture that would allow Europe to end its preoccupation with Ukraine before the situation descends into violent gesture politics. The Russian leader is said to be deeply concerned at the sluggish and divided response of EU leaders and is now looking for ways to “de-escalate” the tension and allow them to back down while looking less hideously impotent than they currently do. Emissaries of the president are understood to be carrying a secret memo from him to Angela Merkel, David Cameron and François Hollande setting out some initiatives Mr Putin could accept in retaliation for his action: “First, I wish to apologise for any difficulty caused to […]

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Diplomats, business leaders urge new approach to Russian energy

Europe’s institutions should take a tough line on Russian energy, as Moscow’s intervention in Ukraine continues, a group of experts on the region said at a roundtable discussion at London’s Chatham House Wednesday. The expert group of former diplomats and business leaders suggested a series of short and medium-term responses to the tensions between the two former allies, pointing out that Russia’s energy interests are a major source of medium-term leverage for the EU and the West, owing to the revenues they bring in. "The EU should convey the message to Russian energy companies that ‘business as usual’ is not an option while intervention in Ukraine continues," the roundtable participants said in a statement following the event. They added that the EU should also consider alternatives to the South Stream pipeline, which would allow Russian gas giant Gazprom’s exports to bypass Ukraine altogether. "If […]

Posted On : Published By : Tom Whipple