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Repsol Abandons Drilling off Canary Islands

ENLARGE Repsol’s drilling program off the coast of Spain’s Canary Islands angered environmental groups. A sign from a 2014 protest, above, reads ‘No to oil companies, yes to renewables.’ Agence France-Presse/Getty Images MADRID— Repsol on Friday said it would abandon drilling off the Canary Islands, ending a year-long conflict that had pitted the Spanish oil company and central government against islanders worried about the effect oil extraction may have on the environment. An exploratory well reaching more than 3,000 meters below sea level found methane and hexane gases but it “lacked the necessary volume and quality to consider future extraction,” Repsol said. The company said it would seal off the well within a week and that it won’t carry out a previously planned second drilling. The well closure puts a cork in a controversial project that began over a decade ago, when seismic studies first suggested there could be […]

Posted On : Published By : Tom Whipple
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Repsol Wins Final Permit to Drill for Oil Off Canary Islands

Spain’s government gave Repsol SA (REP) final authorization to begin exploring off the Canary Islands , capping the energy company’s 12-year quest for permission to tap what may be the nation’s biggest oil find. The Industry Ministry approved the project in a resolution dated Aug. 11 and published today in the Official Bulletin. The Spanish company’s partners are Woodside Energy Ltd. of Australia and German power company RWE AG. Should the drilling be successful, Madrid-based Repsol has estimated it will spend as much as 7.5 billion euros ($10 billion) to develop the site in waters near the Canary Islands of Fuerteventura and Lanzarote off Africa’s west coast. Spain’s largest oil company, which was held up for more than a decade by environmental challenges and delays by the government, has said it expects to begin work before year-end. Geologists have estimated the area between the Canaries and Morocco may hold […]

Posted On : Published By : Tom Whipple
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Gas Carousel Making Spain Europe’s Biggest LNG Exporter

Spain overtook Norway last month to become the region’s biggest exporter of liquefied natural gas. The southern European nation has never produced any of the fuel. The twist is a consequence of the crisis that left more than a quarter of Spain’s workers unemployed as the economy weakened for nine straight quarters. Utilities that contracted to buy LNG before the slump are now contending with a sixth consecutive year of diminishing domestic demand, spurring them to re-export cargoes. The trade is being underpinned by prices in Asia and South America that are about 30 percent higher than in Europe. Japan is importing more after shutting down its nuclear power plants following the Fukushima disaster in 2011. South American nations are accelerating purchases after a drought in Brazil limited the supply of hydroelectric power and cold snaps in the U.S. curbed pipeline flows to Mexico. “It doesn’t make much sense […]

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Foreign Frackers Now Find Comfort in Water-Hungry Spain

A few years ago, fracking in Spain seemed as likely as bullfighting in Britain. These days, energy companies from Texas, Canada and Ireland are going after exploration and drilling permits in hopes of capitalizing on geology that indicates Spain has a sizable chunk of the 883 trillion cubic feet of natural gas in shale estimated to sit under Europe . What’s changed? A sluggish economy for one — the energy industry estimates fracking could eventually create tens of thousands of jobs in a nation with an unemployment rate of 26 percent. Unlocking gas deposits might ease what consumers pay for the heating fuel. It’s about triple the U.S. price. As important, the national government, with the economy in mind, took a pro-fracking stance even as regional and local authorities harden what’s long been widespread European environmental opposition to oil and gas development of any kind. In December, two years […]

Posted On : Published By : Tom Whipple