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China's first liquefied
natural gas (LNG) carrier
Launch was in Shanghai, leading China's shipbuilding industry into a
new era.
The vessel is scheduled to go into operation in October 2007, according
to the Hudong-Zhonghua Shipbuilding Group a subsidiary of the China
State Shipbuilding Corp (CSSC). This marks a major milestone in the
China's shipbuilding history.
The LNG ships are considered to be high-tech products with high-added
value, which could only be built so far in Japan, the Republic of Korea
and several European countries.
China invested more than 100 million yuan in the research and
technology development over the past few years in order to gain a share
in the global LNG market. This commitment and efforts led to the first
contract for LNG carriers in August 2004. The first LNG ship is 292 m
long, 43.35 m wide and has a capacity of 147,200 cubic meters. The
subsidiary group now shares an order of five LNG vessels, with the
second vessel delivery expected in early 2008. The costs of the two LNG
vessels approached 400 million U.S. dollars, according to the
group.
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Bolivian Pres. Plans
to Revise Energy Contracts with Foreign Firms
Xinhua News Agency 12/21/2005 URL:
http://www.rigzone.com/news/article.asp?a_id=27993
The newly elected president of Bolivia, Evo Morales, plans to revise
energy contracts with foreign firms inked during previous governments,
a Spanish newspaper quoted him as saying on Wednesday.
"The contracts were signed when a barrel of oil cost 18.0 or 19.0
dollars, whereas nowadays a barrel is more than 60.0 dollars, " Morales
told Spanish newspaper El Mundo.
"All the contracts will be revised and the multinationals must
understand it. Bolivia must benefit from its gas resources which will
be the basis for new economic growth of the country." said the incoming
leftist President.
Morales said the foreign companies would be guaranteed a return on
their investment and profit "but in a more balanced relationship, not
like now when they pay only 18.0 percent royalties to the state".
A total of 26 multinational gas and oil companies operate in Bolivia,
which has the second-biggest gas resources in South America after
Venezuela.
Morales claimed victory in the presidential race in the Andean nation
on Sunday, and his right-wing chief rival, ex-president Jorge Quiroga,
conceded defeat. The result of the election is expected to be
confirmed on January 13 and Morales will begin his mandate as the first
indigenous president of the country on January 22.
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Bolivia Cleaner and
cheaper public transport
21, December 2005
A local company seeks to convert transport fleets, in order to save
diesel, which is expensive and there is shortage of it in the country.
According to the executives of the company Transredes, one of the main
promoters of this initiative that foresees two benefits for the users.
The first one has to do with the maintenance cost of the converted
engine, which is lower than diesel ones; and the second one is the cost
of the fuel which allows savings of up to 50 per cent.
According to the company’s estimations, the project implies converting
4 thousand vehicles among taxis and buses. Thus, “it will have
redundant benefits for all elements of the chain, that is to say,
distributing companies, refueling stations, transport, and
manufacturers,” said Hugo Vits, marketing vice-president of Transredes.
“The main objective is to eliminate the country’s dependence on diesel
imports,” the businessman added. He also said that Bolivia is located
in an area where currently the neighboring countries are either
balanced in accordance with their production or they are importers,
therefore “the impact of this project will imply a double benefit for
the nation: on one hand it will decrease diesel subsidies, and on the
other, the use of a local fuel is encouraged,” he summarized.
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Peru Seeks to
methanize official fleets
December 2005
The Minister of Production’s private car has the first electronic chip
that guarantees safety standards required for NGV refueling.
Furthermore, the Peruvian state fleet will be gradually converted to
this fuel. The fuel has a clear governmental support, as well as from
many private sectors which are interested in it.
“Peru has a clean and cheap energy resource which is available and at
competitive cost with international levels. Natural gas is definitely
the cleanest and cheapest fuel in the world,” highlighted the Minister
of Production, David Lemor.
Peruvian government’s objective is to gradually convert the whole state
vehicle market, apart from expanding the use of CNG in vehicles in
general.
Besides, the government considers that introducing the fuel will be
very positive for the Peruvian economy, since “it implies energy costs
and hydrocarbon trade deficit will be reduced.” He also says that this
natural resource will benefit users and at the same time it will
protect the environment.
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Kazakh Leader to
Inaugurate Oil Pipeline to China
AFX News Limited 12/15/2005
Kazakh President Nursultan Nazarbayev was set to inaugurate a new oil
pipeline to China that will help fuel the booming Chinese economy.
Chinese and Kazakh officials will ceremonially begin the task of
filling up the 1,000-kilometer pipeline linking Atasu in central
Kazakhstan to Alashanku in western China. The US $700 million project
has been jointly developed by the China National Petroleum Corporation
(CNPC) and the Kazakh state energy company Kazmunaigaz.
The pipeline is due to start delivering oil from the Kumkol field in
central Kazakhstan by the middle of next year, with an initial capacity
of 10 million tons annually.
But today's ceremony is also a milestone on the road to a more
ambitious goal for which Kazakh authorities have set a 2011 deadline:
the extension of the pipeline from Kazakhstan's core oil fields on the
Caspian Sea to Alashanku, in China's western Xinjiang province, a
distance of some 3,000 kilometers.
Officials also plan to double the capacity by the same date.
Frustrated in some other parts of the world -- notably the US --
China's oil industry has played an growing role in Kazakhstan's rise to
major oil producer status.
CNPC recently clinched the purchase of the previously Canadian-run
independent PetroKazakhstan.
PetroKazakhstan is likely to be a key source of oil for the pipeline
from Atasu to China as its fields lie in central Kazakhstan. CNPC is
also reportedly looking into a possible purchase of another
Canadian-run oil firm, Nations Energy.
China's growing role in Kazakhstan thus far appears to have caused
little anxiety in Moscow, the Soviet-era center of power for the
region. By contrast, Russia gave a distinctly frosty reception to the
inauguration earlier this year of the Washington-backed
Baku-Tbilisi-Ceyhan pipeline that runs from the Caspian to Turkey's
Mediterranean coast and symbolizes the Westward-oriented leg of Kazakh
oil policy.
This latest nonchalance may partly be due to the pressure Russia itself
is feeling to supply oil direct to China that might fetch a better
price elsewhere.
Kazakshtan's landlocked location makes a difficult balancing act all
but unavoidable. Analysts have noted that the Atasu-Alashanku pipeline
has the disadvantage of a single buyer at the receiving end, increasing
Beijing's ability to dictate the purchase price.
The Kazakh government has set a goal of raising oil total exports from
about 1.2 million barrels a day this year to 3.5 million barrels a day
in 2015.
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Gazprom Aims at U.S.
Market; Seeks to Expand Reach to China
12/15/2005 URL: http://www.rigzone.com/news/article.asp?a_id=27829
Gazprom, the giant state-owned Russian energy company, has announced
ambitious plans to become a major player in the United States and China
as it starts to diversify beyond Central Asia and Europe.
Alexander Medvedev, the deputy chairman of Gazprom, said during an
interview Tuesday that the company's long-term strategy involved
establishing a foothold in the U.S. market. "Our aim is to gain more
than 10 percent of the U.S. market share by 2010, increasing to 20
percent," he said.
The natural gas to be sold to the United States would be extracted from
the Shtokman field in Russia's Barents Sea, north of the Arctic Circle.
Gazprom already supplies a quarter of the European Union's natural gas,
including a third of Germany's. Medvedev said Gazprom was in the final
stages of choosing an international consortium to finance the project,
conduct exploration and drilling, and ship the natural gas to the
United States in liquefied form.
The list of contenders, reduced to five companies from nine, consists
of ConocoPhillips and Chevron of the United States, Statoil and Norsk
Hydro of Norway, and Total of France.
Medvedev said the selection of up to three companies would be made by
April. And if the project remains on schedule, the Shtokman field could
go into commercial operation in 2010 or 2011, and long-term contracts
with U.S. companies could begin after 2010. Gazprom is also looking
beyond the U.S. and European markets to China. The company has already
started talks with the state-owned China National Petroleum to see how
much natural gas the country would require.
"China has its own specifications because of how much coal it uses,"
Medvedev said. From 2010 to 2015, Gazprom is aiming to sell China 30
billion cubic meters, or more than one trillion cubic feet, of gas a
year. But the ultimate size of the market is unknown.
Gazprom first started considering the American market after the Sept.
11, 2001, attacks on New York and Washington, as the U.S. government
started seeking ways to diversify its energy supplies. Gazprom said the
United States was one of the best export destinations for Russian
liquefied natural gas because of rising demand. According to the U.S.
Department of Energy, demand for natural gas will increase 1.5 percent
a year until 2025. There are concerns that U.S. imports of liquefied
natural gas will be constrained by the limited number of ports that can
handle the commodity. The United States has just five, including one in
Puerto Rico. But an adviser to Gazprom said Tuesday that current U.S.
port facilities had the capacity to handle the company's projected
exports, and he noted that there were proposals to build more liquefied
natural gas ports in the United States.
It is still not clear how much it will cost to develop the Shtokman
field.
But Hans-Joachim Gornig, manager of ZGG, a German company that markets
Russian natural gas in Western Europe, said Gazprom was adopting a new
approach by seeking foreign companies to provide expertise and support,
and foreign banks to provide financing.
Medvedev said that Gazprom would hold a majority in any agreements with
foreign companies.
Gazprom is not the first Russian energy company to covet the U.S.
market. Lukoil, the biggest Russian oil company, has 2,000 gasoline
stations in the United States and has been expanding rapidly.
Medvedev was speaking in Berlin five days after a Russian-German
consortium started work on the 4.5 billion, or $5.4 billion, North
European Gas Pipeline. That project, scheduled for completion by 2011,
will allow Russia to export gas directly to Germany and its other West
European markets through a pipeline to be laid under the Baltic Sea,
reducing its dependence on the traditional transit route across Ukraine
and Poland.
"The North European pipeline will allow Gazprom to diversify its
transit routes, to expand volume and to increase the amounts of gas we
export to Northern and Western Europe," Medvedev said. "Above all, it
will give Europe stable and secure supplies of gas."
The decision to start building the North European Gas Pipeline followed
extensive lobbying by Gerhard Schroder, at that time the chancellor of
Germany, who left office last month and last week was appointed
chairman of the company overseeing the project. Medvedev dismissed
criticism that Schroder's appointment was politically motivated.
"Having Mr. Schroder heading the supervisory board of this project is
so important for Europe as a whole," Medvedev said. "You need to have
somebody in such a position who is in a position to make decisions on
that level. We could not have found a better person."
The decision to build the pipeline under the Baltic Sea coincides with
a bitter and protracted dispute between Gazprom and Naftogaz, the
state-owned Ukrainian company that controls the transit pipeline now
carrying Gazprom's gas to Western Europe. In January, both sides agreed
to do away with a barter system in which Ukraine received Russian gas
in return for waiving transit fees on gas sent to Western Europe, and
to replace it with a cash-based system. But the details are still in
dispute.
Medvedev said the new system meant that Ukraine would have to pay
market prices for its imports of natural gas from Russia, while Russia
would pay the transit fees in cash. "Our position is clear," Medvedev
said. "We do not want to subsidize our gas sales to Ukraine. We want to
charge Ukraine $160 per 1,000 cubic meters of gas. We are willing to
pay $1.09 per 100 kilometers per 1,000 cubic meters of gas shipments.
Ukraine does not want to accept this."
In Moscow, Alexei Miller, the chief executive of Gazprom, warned
Tuesday that the company could cut off Ukraine's supply of gas if no
deal is reached. "If no compromise over Russian gas supplies to Ukraine
is found before the New Year, the supplies will be stopped," Miller
said, according to Russia Today.
Ukraine, in turn, has threatened to use its leverage as a major transit
route for Russian natural gas by blocking deliveries to Europe.
Medvedev said this amounted to blackmail and showed just why the North
European pipeline was necessary to protect Europe's energy supplies.
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New Bolivian
Government Will Face Off with Oil Companies
EFE News Services 12/14/2005 URL:
http://www.rigzone.com/news/article.asp?a_id=27792
Hefty new taxes on the abundant natural gas from Bolivian wells has
beefed up the coffers of the poorest nation in South America as it
approaches general elections Sunday, but the foreign oil companies that
do most of the extracting are peeved at the levies and threatening to
take the Andean nation to international court.
The new revenue stream has certainly eased the task of managing the
public finances in an economy where the gross domestic product is $9
billion, or $2,600 a year on a per capita basis.
Bolivian governments have long been caught between a populace chafing
at budget cuts after years of austerity and demands from the
International Monetary Fund for further belt-tightening as a condition
of allowing La Paz to borrow more.
The source of the treasury's windfall is the 32 percent levy on oil and
gas production, which brought in $235 million from May through October
and is projected to generate $417 million in 2006, the first full year
of the new tax regime for the energy sector.
Equivalent to nearly 5 percent of GDP, that sum could have an immense
impact in Bolivia, whose meager spending on infrastructure and services
contributes to keeping 63 percent of its roughly 8.5 million people
living below the poverty line.
The bonanza from the tax has combined with the surge to more than $1
billion in the value of Bolivian gas and oil sold abroad in the first
10 months of 2005 - just under half of the nation's total exports - to
make the hydrocarbons industry "the goose that lays the golden eggs,"
economist Napoleon Pacheco told EFE.
Growth in revenues from oil and gas is expected to power a 3.9 percent
increase in GDP this year, while helping the government reduce its
projected budget deficit from 5.2 percent of GDP to 3.5 percent.
"What happens (to the hydrocarbons sector) is of vital importance to
Bolivia and, regrettably, what we see at this moment is that it is
unfolding in a context of uncertainty," said Pacheco, who heads
Fundacion Milenio, a centrist think-tank.
Socialist Evo Morales, the front-runner for president, has insisted
that a government headed by him will make the foreign firms that
control Bolivia's energy industry into decidedly junior partners of the
state. The Indian leader of the country's organized coca growers misses
no chance to rail against "the neoliberal model," the sort of
laissez-faire market-oriented capitalism he blames for many of the
country's ills.
Whatever its ideological stripe, the Bolivian government that emerges
from the Dec. 18 elections will be bound to implement the sweeping
energy law that imposed new taxes and terms on the multinationals.
Prior to the measure, the royalties Bolivia collected on oil and gas
extracted from its soil were among the lowest in the world.
The law's provisions explicitly require changes to the contracts
foreign companies signed with Bolivia in the 1990s, when a "neoliberal"
government in La Paz set about privatizing most state industries.
While failing to satisfy the demands from labor and grassroots groups
to nationalize the oil and gas industry, the measure did assert the
state's ownership of the hydrocarbons and its leading role in the
energy sector.
Some of the international firms with big interests in Bolivia, such as
Spain's Repsol YPF, British Gas and French oil major TotalFinaElf, say
that failing a satisfactory accord, they will cite Bolivia before
international courts of arbitration for breach of contract.
In the meantime, however, the multinationals are paying the additional
levies.
The Bolivian Hydrocarbons Chamber, representing local affiliates and
partners of the foreign companies, says international law is on the
side of the private firms, while the government recently had to
acknowledge that the legislation overhauling the energy sector does not
provide enforcement mechanisms or penalties for non-compliance.
Bolivia's provisional president, Eduardo Rodriguez, persuaded the
multinationals to give negotiators until June 30, 2006, to try to
hammer-out a mutually satisfactory agreement that would avert
litigation.
The firms consented to extending the period for bargaining in exchange
for Bolivia's pledge not to introduce any additional measures affecting
the foreigners' investments in the Andean nation.
Yet with even conservative presidential hopeful Jorge Quiroga talking
about "nationalizing the profits" from oil and gas, it is clear the
multinationals will have to adjust to a new reality in Bolivia, where a
majority seems ready to insist that the country's main natural resource
be harnessed to lifting people out of poverty.
A 2004 World Bank study found that across Latin America, the average
discrepancy in wealth between the richest and poorest fifths of the
population within a country is 30:1. The comparable ratio for Bolivia
is 90:1.
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Bolivia Tax reduction
for NGVs LPG forbidden
dec 10 2005
The Municipal Council of Tarija is working on a project for vehicles to
stop using LPG and to be converted to natural gas with a 20 percent tax
reduction.
Thus, the Council President, Roberto Úvila, highlighted that this
proposal seeks to promote a safer and cleaner city.
Úvila said that “they must promote NGV conversions legally” and he
reminded that in Bolivia there is a decree forbidding the use of LPG
vehicles.
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Bogota Dramatic increase of
CNG conversions
10, December 2005
Now, there are 1,300 vehicles running on natural gas in the Colombian
capital city. According to October’s figures, there are already 30,000
NGVs altogether in such area.
According to the National Ministry of Mines and Energy, when this fuel
entered the market –back in 2000- there were only 130 converted
vehicles, taxis, and buses, in the city.
Conversions increase mainly because CNG is cheaper regarding gasoline.
Fabián Suspes, taxi driver, clearly explains the reasons “In a long
shift from 6 am to 6 pm I used to spend 60 thousand pesos in fuel, but
since I have natural gas I barely spend 15 thousand.” There is also
savings in the change of oil. “I used to change it every 4 thousand
kilometers and now it lasts 6 thousand kilometers.”
There are savings also due to the high price of gasoline, that during
this year it has increased 9.7 percent. This trend is so strong, that
the use of natural gas for vehicles represents 13 percent of the fuel
market in the capital city.
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Argentina
Sub-secretary of Fuels denied CNG rise
10, December 2005
The project of Gas Electronic Market (as in Spanish MEG) for the
refueling stations to acquire this fuel as from January 1st 2006, is
creating doubts and controversies in the sector, they fear the price
per m3 may rise.
Thus, Cristian Folgar tried to clear out doubts and he said, “The
maximum price will be established by the Secretary of Energy.
CNG stations will not pay more than industries and fuel prices are not
foreseen to increase.”
The officer said during a television program specialized in energy,
that it is “ridiculous” to think prices will increase, and he also said
they will be stable until December 31st 2006.
Meanwhile, Fausto Maranca, president of the Argentinean Chamber for
Compressed Natural Gas also denies a major increase for this fuel.
Beyond those who are against or in favor, if there is no delay, MEG
will be a reality as from the first day of 2006. By the time being, the
Sub-secretary of Fuels is trying to keep everybody calm. “If there is
something about CNG to be done, that is to go on promoting it and it
must continue being the cheapest among the fuel market.
Besides, refueling stations are the priority within the supply chain,”
concluded Cristian Folgar.
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Peru Refueling stations boom
10, December 2005
The Peruvian company of natural gas, PGN, is planning to build 17 new
refueling stations by 2007.
This ambitious project will require an investment of approximately 8
million dollars. Furthermore, next year 7 new stations and 10,000 of
NGV conversions are expected. One of the main market targets at this
first stage are taxis.
After the opening of the first refueling station in Lima a few months
ago, NGV perspectives in Peru are encouraging. This has gained business
and users interest.
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Venezuela to lay
gas pipeline from north Colombia
Source: Diario El Universal 24-11-05 http://www.gasandoil.com
Colombian President Alvaro Uribe initialled a project by Venezuela and
the Andean Development Corporation to start layout of a gas pipeline
from Colombian reservoirs in the Caribbean to Maracaibo port, a
Venezuelan diplomat reported.
The decision was made following meetings held in Bogotá over the last
few weeks by delegates of state oil holding Petroleos de Venezuela
(PdVSA) and Colombian Petroleum Company (Ecopetrol), Venezuelan
ambassador to Bogotá Carlos Rodolfo Santiago said. "Now, only technical
issues remain, as Presidents Hugo Chavez and Alvaro Uribe already made
the political decision," Santiago told.
The project includes a gas pipeline from Colombian submarine wells in
front of the Guajira peninsula to Maracaibo, to supply the Venezuelan
region, where there is plenty of oil deposits, but lack of gas. The
project will have about 200 km length for an estimate of $ 300 mm.
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Gazprom LNG swap to
Cove Point first pipeline gas
Source: Gazprom OAO 23-11-05 http://www.gasandoil.com
Gazprom has announced that it has successfully concluded its first
pipeline natural gas for LNG swap with Gaz de France. The agreement was
concluded between the Gazprom subsidiary, Gazprom Marketing &
Trading, and Gaz de France, Med LNG & Gas and Shell.
Under this transaction, Gazprom will deliver additional pipeline gas to
Gaz de France in Europe and in return will purchase an LNG cargo from
Med LNG & Gas, which is a joint company of Gaz de France and
Sonatrach. The LNG cargo is being sold to Shell Western LNG for
delivery to the Cove Point import terminal in Maryland, United States,
in early December this year.
Alexander Medvedev, Deputy CEO of Gazprom, commented: "With these
agreements, Gazprom has shown that by leveraging our position in
pipeline gas in Europe, we are able to access global gas markets with
Russian gas by swapping pipeline gas for LNG. This is a unique way of
creating LNG out of Russian pipeline gas and moving it to foreign
markets.” “Building new relationshipswith LNG partners while expanding
our existing partnerships in Europe has given us the platform to expand
our LNG business in the years to come and will accelerate Gazprom's
global growth in new markets such as the United States."
Notes:-- Gazprom is 38 % owned by the Russian Federation and employs
330,000 people across Russia. -- For more than 30 years, Gazprom has
been supplying gas for mainland European countries including Germany,
Austria, Italy and France. -- Gazprom provides gas direct to customers
in Russia. -- Gazprom Marketing & Trading is the UK arm of Gazprom.
The company was established in 1999.
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Azerbaijan-BP BTC
pipeline pumps 4 mm barrels of oil
Source: Kazakhstan Today 24-11-05 http://www.gasandoil.com
Four million barrels have been pumped into the Baku-Tbilisi-Ceyhan
(BTC) pipeline out of the planned 10 mm, BP-Azerbaijan (project
operator) has informed. The filling of the Turkish part of the pipe
started earlier. In particular, the oil passed the Georgian-Turkish
border and reached the first pumping station on the territory of Turkey.
"Now we are facing a period of scrupulous tests before filling of the
Turkish part of the pipe. The pipe tests take much more time than it
was originally planned.” “Very scrupulous tests are carried out to
reduce the risk of accidents for the whole period of the pipeline
operations," the company has explained.
BP-Azerbaijan also says that a ceremony on the occasion of departure of
the first tanker with Azeri oil from Ceyhan will take place next
spring. Originally the departure was planned before the end of 2005.
The length of BTC pipeline is 1,767 km, of which 443 km are in
Azerbaijan, in Georgia -- 248 km, in Turkey -- 1,076 km. The pipeline
capacity is 50 mm tons of oil per annum. The construction works
commenced in April 2003.
The participants of BTC project are the following: BP (30.1 %); SOCAR
(25.00 %); Unocal (8.90 %); Statoil (8.71 %); TPAO (6.53 %); ENI (5.00
%); Itochu (3.40 %); ConocoPhillips (2.50 %); Inpex (2.50 %), Total
(5.00 %), and Amerada Hess (2.36 %).
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India suggests to
include Azerbaijan and Uzbekistan in TAP pipeline
Source: Sify Ltd 27-11-05 http://www.gasandoil.com
India has suggested that Azerbaijan and Uzbekistan could also be
included in the Asian Development Bank supported
Turkmenistan-Afghanistan-Pakistan (TAP) gas pipeline to tap the Caspian
gas. The country, which is also considering joining the project, has
suggested laying a crude pipeline from Azerbaijan to the Arabian Sea to
bring Caspian oil to the world's fastest growing consumption centre.
The Minister for Petroleum and Natural Gas, Mani Shankar Aiyar, after
holding wide-ranging bilateral discussions with the heads of
delegations from Uzbekistan, Azerbaijan, China and Turkmenistan,
suggested to Idriz Rzabeyov, Head of Energy Department, Ministry of
Energy, Azerbaijan that the TAP pipeline should start in Azerbaijan and
culminate in India. Aiyar said India had been invited for the next
meeting of the Steering Committee on TAP pipeline as observer before
committing to join the project. He said that he had told the Uzbekistan
Minister for Foreign Economic Relations, Investment and Trade,Rustam
Sodykovich Azimov, that Uzbekistan gas reserves should also flow
through the TAP pipeline.
As regards gas reserves in Turkmenistan and what would be available for
TAP pipeline, Aiyar said, “the gas reserve figure told to me was very
high, much beyond what was being talked about.'' Turkmenistan, he said,
had assured that the country had enough gas reserves for TAP after
meeting commitments to Russia. During the bilateral meetings with the
three countries, Indian companies also showed interest in exploring for
oil and gas and participating in downstream refining and petrochemical
business. Aiyar said Indian Oil Corporation (Indian Oil) was interested
in downstream oil refinery, petrochemical and LNG collaborations with
Uzbekistan, while ONGC Videsh Ltd (OVL) had shown interest in acquiring
stake in Turkmenistan's state-owned oil and gas company.
The Minister also said that OVL was keen on exploring for oil and gas
in Uzbekistan, Azerbaijan and Turkmenistan, while Indian Oil was
looking to participate in upgradation of a refinery in Turkmenistan.
Aiyar also proposed to host a seminar in the first quarter of 2006-07
for the participants of the Baku-Tbilisi-Ceyhan (BTC) oil pipeline
(Azerbaijan, Georgia and Turkey).
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Israel will start
receiving Egyptian gas September 2007
Source: Globes Online 21-11-05 http://www.gasandoil.com
Israel will begin receiving natural gas from Egypt on September 30,
2007. Eastern Mediterranean Gas (EMG) chairman Mohammad Tawila gave the
Ministry of National Infrastructures the company’s plans for building a
gas pipeline from El Arish in Sinai to Ashkelon. Under the timetable,
natural gas will begin flowing on September 30, 2007. EMG is due to lay
the pipeline by the end of 2006, and to carry out infrastructure work
at the Eilat-Ashkelon Pipeline Co. (EAPC) site in Ashkelon during 2007.
The final stage of the project will link up the pipeline with Israel’s
natural gas pipeline, being built by Israel Natural Gas Lines Company.
During the discussion, Ministry of National Infrastructures director
general Eli Ronen said the natural gas project was an opening for
additional infrastructure projects between Israel and Egypt. Minister
of National Infrastructures Benjamin Ben-Eliezer said that, despite
Israel’s current political situation, he was convinced that the natural
gas deal with Egyptwould strengthen relations between the two
countries, and become a platform for developing bilateral economic
relations.
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Iran to start LNG
exports to Europe by 2011
Source: Mehr News Agency 13-11-05 http://www.gasandoil.com
Managing director of the National Iranian Gas Company, Rokneddin
Javadi, said that Iran has signed a Memorandum of Understanding (MoU)
to export natural gas to Italy. “The project of exporting LNG to Europe
will be implemented by 2011,” he added.
The official also stated that Iran would export gas to China by the end
of the current year. China’s oil giant Sinopec Group had signed a $ 70
bn oil field development and LNG agreement with Iran on October 28,
2004. Under the MoU, Sinopec could buy 250 mm tons of LNG over 30 years
from Iran and develop the giant Yadavaran field. Iran is going to
attain annual LNG export of 36 mm tons, worth $ 6 bn, by 2015, Javadi
noted.
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Gazprom wants
partnership with Turkey
by Mirza Cetinkaya Source: zaman.com 19-11-05
Russian natural gas company Gazprom, Turkey’s partner in the Blue
Stream natural gas pipeline project, has hopes to secure a stronger
partnership with the country through new projects.
Gazprom CEO Spokesman Sergei Kupriyanov assessed the bilateral
relations, “In many fields, we would like to broaden our partnership
with Turkey, who we see as our partner. We are very carefully following
the investment market in Turkey.”
After Germany and Italy, Turkey is the third country Russia makes deal
with regard to natural gas Kupriyanov said, and if China does not take
any action, Turkey will be the number one customer of Gazprom. The
company is one of the main players of a working visit by Russian
President Vladimir Putin, and they have taken certain measures to
increase the amount of natural gas pumped through the Blue Stream
pipeline that will be officially opened at a ceremony in Ceyhan, Turkey.
Three teams sent to Krasnodar and Stavropol regions installed a system
to increase the atmospheric gas pressure from 75 to 250. After the
talks with the Turkish delegation, the amount of gas will be increased.
Gazprom transferred 3.2 bn cm of gas via the Blue Stream pipeline in
2004, but wants to end 2005 with a total of 4.5 bn cm gas. In line with
the agreement regarding the amount of gas, this figure will be
increased to 16 bn cm in the years to come. Since 1987, Turkey has
received 12-14 bn cm of gas annual from Russia via Trace.
According to information Kupriyanov submitted, Putin during his meeting
with Turkish Prime Minister Recep Tayyip Erdogan will discuss the
natural gas storage system Gazprom plans to construct in the Salt Lake,
a central Anatolian lake and the second biggest in the country, and the
company’s participation in the tenders for energy distribution in
Turkey. Due to increasing demands and weather conditions, a storage
system is required for Turkey, Kupriyanov believes. If Turkey shows an
interest in this project, the facility to be established will provide
greater ease in the use of gas. Russia possesses 24 similar gas storage
systems and already stores 63 bn cm gas at these facilities.
As for the rising concerns about that a Russian monopoly will occur in
the Turkish natural gas sector, the spokesman said that none of the
countries they currently conduct business with have expressed any
upsets so far.
“We sell gas to almost all of Europe. We have many long term projects.
If we apply other channels to create upsets, then we will be the one
who loses business.” Besides, Gazprom officials defend, the prices they
apply to Turkey are to that equal of other countries. Another Russian
company has also shown interest in establishing an oil refinery in
Ceyhan, Turkey.
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Gazprom considers gas
supplies to Israel, Italy and Greece
23-11-05 Source: RIA Novosti
Russian energy giant Gazprom is studying the possibility of natural gas
deliveries to Israel, Italy and Greece, a top Gazprom manager said.
"We have plans to increase the capacity of the Blue Stream gas
pipeline, and we are considering natural gas deliveries to the Middle
East, Israel and other countries, and the initial calculations have
shown that this project cant be effective," said Alexander Medvedev,
the company's deputy CEO and general director of its subsidiary
Gazexport.
He said Blue Stream was able to work at full capacity.
Speaking about possible deliveries of natural gas to southern Europe,
Medvedev said he doubted any other gas could compete with Russia's.
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The Samsun-Ceyhan pipeline
by Kadir Dikbas 24-11-05 Source: Zaman.com
Important developments took place recently.
The first was Calik Energy, which is interested in the Samsun-Ceyhan
pipeline, announcing that it has reached an agreement with the Italian
ENI company for this project. As we know, ENI which has an oil field in
Kazakhstan, is also one of the partners of Blue Stream.
Then on November 17, the Blue Stream Natural Gas Pipeline was realized
at an official opening ceremony attended by Turkish Prime Minister
Tayyip Erdogan, Russian President Vladimir Putin and Italian Prime
Minister Silvio Berlusconi. On the same day, the first oil from the
Baku-Ceyhan pipeline crossed into Turkish territory.
It is true that the Baku-Ceyhan pipeline is about to be completed but
it does not have the capacity to prevent the Turkish Straits from being
an oil route. The burden on the straits will increase in the
forthcoming years. Hence, relevant countries and companies, Turkey in
particular, are working on alternatives that will carry oil from the
Black Sea to Europe and other countries, by casting aside the Straits.
There are more than 10 projects and most of these projects include
formulas without Turkey. Turkey is insisting on Samsun-Ceyhan it
considers more economical and practicable. As we can still remember,
there is already a pipeline operating between Kirikkale and Ceyhan. The
new pipeline will follow the same route. If this project materializes,
Ceyhan will turn into an oil stock exchange, it will be a centre where
Iraqi, Azeri, Russian and Kazakh oil meet.
This line has two strong rivals: TransBalkan and Burgaz-Dedeagac
pipelines.
The TransBalkan pipeline project stretches as far as the Adriatic Sea
through Bulgaria, Macedonia and Albania. The project's feasibility
studies have been completed but the construction stage has not been
reached yet.
And talks on the Burgaz-Dedeagac pipeline are still continuing. Russia
supports this project.
Not only countries but companies are also playing distinctive roles in
these alternatives, however, it is a fact that political choices
predominate over them. The "energy summit" that was held in Samsun on
November 17 was very important from this perspective.
Because the official opening of a line that has been operating since
February 2003 was not so important. The important thing was the
cooperation to ensue after this as well as the new projects. Turkey
expected strong support for Samsun-Ceyhan at this summit. But this
expectation did not come true.
Italy supported the project during talks that were closed to the press.
Putin carefully avoided giving any answer that would satisfy Turkey.
"Let’s first examine the feasibility and then we will talk later," he
said.
Also during the ceremony, Putin gave the following message which was
far from fulfilling Turkey's expectations but was important for his own
country: "The Blue Stream creates new opportunities for the transfer to
third countries, too. It can be extended to Italy, southern Europe and
Israel through another pipeline in the bottom of the Black Sea."
Russia wants to sell more gas than Blue Stream and to reach not only
Europe but also Israel and even Africa via Turkey by laying a parallel
line. Besides, it also asking for the construction of a natural gas
depot planned for Tuz Lake. Nevertheless, it remains cool to the
project that will transfer Russian and Caspian oil to Ceyhan.
It is a fact that Blue Stream was not a "victory" for us, because this
is a project that relegates Turkmen gas to the second plan, delays the
arrival of Azeri gas and makes Turkey dependent on Russian gas.
At the moment, Turkey is calculating on how to turn the pipeline built
and the agreements made into its own advantage. Seeking support for
Samsun-Ceyhan at the Blue Stream ceremony must be taken into
consideration under this framework.
Even though Erdogan says, "I think we can build a Samsun-Ceyhan bypass
pipeline in the same cooperation spirit," Russia only wants its natural
gas to go down to the south, not its oil, for now. It seems we must
have to wait until we see the projects that will be vital to Turkey’s
interests.
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World Bank backs plans for
South American gas pipeline
Source: AP 16-11-05 http://www.gasandoil.com
The World Bank supports plans for a natural gas pipeline that would
transport natural gas throughout South America, a representative of the
bank said. Venezuelan President Hugo Chavez has announced plans to
construct a pipeline network to supply the continent with natural gas.
The pipeline network may eventually transport Bolivian natural gas as
well.
Eleodoro Mayorga, the World Bank's chief oil economist, expressed
support for the proposal at a conference in Caracas, calling it a step
in the right direction. Venezuela, which has the largest natural gas
reserves in the region, is discussing the first stage of the pipeline
project with neighbouring Brazil. A pipeline from Venezuela through
Brazil and Uruguay is on the agenda for a meeting in Caracas between
Chavez and Argentine President Nestor Kirchner. But Argentine officials
were unable to confirm whether the idea would be discussed.
To increase gas output, Venezuela is selling exploration and production
licenses to local and foreign firms. The state-run oil company
Petroleos de Venezuela, or PdVSA, sold three exploration and production
licenses for $ 61 mm (EUR 52 mm).
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Indonesia to build
Kalimantan to Java gas pipeline
Source: Asia Pulse 18-11-05 http://www.gasandoil.com Source: Antara
The government will build a gas pipeline from East Kalimantan to
Central Java even though surveys show the project is not feasible. A
team of government officials has reportedly said the project is not
feasible as the gas deposits in East Kalimantan are not enough to
warrant the $ 1.4 bn project. Moreover, most of the province's gas
production has to be exported on long term contracts with foreign
buyers until 2010.
Energy and Mineral Resources Minister Purnomo Yusgiantoro told he has
received the report from the team but he has returned the report and
asked it to undertake further studies. The team should carry out
comprehensive studies and not only based on the strength of reserves in
East Kalimantan, he said. A shortfall in supply from East Kalimantan
could be covered with supply from other areas, he said, citing that
export commitments could be served with gas from Tangguh in Papua.
Purnomo's statement contradicted what he said earlier that the project
was not a priority in the next one to two years. He was quoted as
recommending thorough study on the project especially as most gas from
East Kalimantan has been appropriated for exports until 2010. Oil and
gas observer Ramses Hutapea said the conflicting statements by Purnomo
showed that he was under pressure from one more powerful than him to go
ahead with the project.
Study says Kalimantan to Java gas pipeline is not feasible
15-11-05 The $ 1.2 bn gas pipeline project from East Kalimantan to
Central Java is not economically feasible because of the limited gas to
be transported.
If the project has to be carried out the government has to cancel
contracts with foreign buyers on exports of liquefied natural gas, a
study by a team of government officials said.
The project is among the infrastructure projects included in the
priority list to be implemented by the government. It is part of the
government program to reduce dependence on oil fuel for industries.
The team said that the government should rely only on proven reserves
of gas as there is no guarantee from indicated and inferred reserves.
Proven reserves in East Kalimantan are only 4.3 tcf and it will last
only for 10 years without exports.
"If we are to continue exports of LNG, the gas reserves in East
Kalimantan will not be enough for Java, therefore, one of the two
options has to be cancelled," team chairman Tubagus Haryono said.
Tubagus said he would senda letter to the chief economics minister to
announce a clear gas policy.
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Afghanistan NASA confirms
gas and mineral reserves
17-11-05 Source: The PakTribune http://www.gasandoil.com
The US-based National Aeronautics and Space Administration (NASA) has
confirmed the existence of gas reserves in northern and south-western
Afghan regions. The NASA also hinted at the existence of copper and
gold reserves in the central Logar province and fuel reserves near Amo
River, a senior official claimed.
Afghan Mines and Industries Minister Mir Mohammad Siddique told: "We
were earlier unaware of the natural gas, copper and fuel reserves
discovered by NASA.". An agreement on exploring these reserves
involving $ 17 mm was signed between the Afghan mines minister and
former US ambassador Zalmay Khalilzad in Kabul last year. The NASA
launched its work of exploring the natural resources by taking aerial
pictures of the mines. The minister said the US agency had provided him
a map showing Afghanistan’s different mines.
He added there were gas mines in Balkh, Faryab, Badghis and Jawzjan,
Farah and Helmand while copper and gold reserves were found in Logar.
He said the exploration had shown fuel reserves on both sides of Amo
River. Siddiqui continued the government wanted to buy modern equipment
for excavating the sites. "We have contacted the Asian Development
Bank, which has pledged to give us funds for the purchase of modern
excavation tools."
The government planned to hand over the mines to private companies, he
said, revealing the $ 33 bn copper reserves in Logar would be leased
out to a firm. Also, there are mines of precious stones in Afghanistan
and the US has promised to help in their excavation and cutting.
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Russia publishes plan for new
Siberia-Pacific pipeline construction
Source: Neftegaz.RU 14-11-05 http://www.gasandoil.com
Russia's energy ministry published a timetable for construction of
2,300-km section of a oil pipeline, from Siberia to the Pacific coast
and possibly China. The project presented to Russia's cabinet sets
November 1, 2008, as the completion date for a pipeline section from
Taishet in Irkutsk province to Skovorodino in Amur province, as well as
the necessary pumping stations and, separately, an oil terminal at the
Pacific port of Perevoznaya.
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Uzbekistan looks east
for new friends
by Simon Tisdall 24-11-05 Source: The Guardian
It looks like Craig Murray was right all along. To the US's annoyance,
Britain's former ambassador to Uzbekistan publicly criticised human
rights abuses by President Islam Karimov's government.
Mr Murray lost his job last year. But even the most hard-nosed US
strategists could not turn a blind eye to the massacre in the town of
Andijan in May. The ensuing confrontation, all the more explosive for
being delayed, has come at a high price to Washington's interests in
central Asia.
Rejecting western demands for an independent inquiry into Andijan, when
hundreds died, the ostensibly pro-American Mr Karimov has switched
sides. He ordered the US to close its military base in Uzbekistan, a
key part of its Afghan operations. And he turned to China for
consolation.
Beijing, keen to expand its regional clout and discourage indigenous
Muslim "splittists", unquestioningly accepted his claim to be battling
an Islamist insurrection. Moscow, with Chechnya in mind, also
sympathised. At a Kremlin ceremony earlier, Mr Karimov signed a mutual
defence pact with Russia. NATO was also kicked out. Washington's Uzbek
policy lay in tatters.
With its valuable oil, gas and mineral reserves and authoritarian
political tradition, Uzbekistan is a typical battleground in what is
fast becoming an epic, three-way struggle for power, influence and
resources in post-Soviet central Asia.
"Its the world's last vacuum," said Kalman Mizsei, regional director of
the United Nations development programme. "The region has become a
playground for rival geopolitical interests." But increased cooperation
rather than competition between countries should be the aim, he said.
Having "lost" Uzbekistan, the US, EU and Japan are nervously tracking
unfavourable trends in two of its neighbours. As in Ukraine and
Georgia, Kyrgyzstan's "tulip revolution" last March has brought
disappointment in its wake. The government of Kurmanbek Bakiyev has
been beset by troubles, including the killing of three MPs.
Mr Bakiyevthreatened to use troops to impose order earlier.
"Those taking up arms and attempting to speak a language of force with
the authorities will be terminated, full stop," he warned in a manner
reminiscent of his ousted predecessors.
Kyrgyzstan, meanwhile, wants the US to pay more for the use of its
airbase there -- or face an Uzbek-style eviction. The demand follows
claims that the Pentagon connived in under-the-table payments worth
millions of dollars to the family and friends of the deposed president,
Askar Akayev.
The integrity of Kazakhstan's presidential election on December 4 is
also giving cause for concern. Visiting in October, Condoleezza Rice,
US secretary of state, urged Nursultan Nazarbayev, the president, to
ensure fair polls. She denied the US was soft-pedalling to safeguard
its oil and security interests, an accusation also heard during
Azerbaijan's flawed elections in October.
Since her departure a leading opposition figure, Zamanbek Nurkadilov,
has mysteriously died of gunshot wounds amid claims of intimidation and
media bias. But Mr Nazarbayev's spokesman reassuringly said there was
no need to rig the polls.
"The president would win even if we sat around doing nothing," he said.
Democracy's trials in central Asia are of less concern for Russia and
China, which may give them a short-term advantage. Ignoring the human
rights issues highlighted by Mr Murray, both are building economic ties
bilaterally and through the Shanghai Cooperation Organisation, to which
most central Asian states belong. But Mr Mizsei said Russia would
resist China's advances.
"All these countries are more familiar with a Soviet big brother than a
Chinese one," he said. "There will definitely be a divergence of
interests."
If and when that happens, the west could win in the east.
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India eyes alliance with
China and Uzbekistan for oil assets
Source: www.keralanext.com 26-11-05 http://www.gasandoil.com
In a bid to seek greater cooperation among the Asian nations for energy
security, Petroleum Minister Mani Shankar Aiyar met representatives
from China and Uzbekistan to boost the ongoing efforts towards
developing an Asian oil and gas grid. A day after the meeting of the
ministerial round table on co-operation between North and Central Asian
producers, Aiyar called on Rustam Sodykovich Azimov, Foreign Economic
Relations, Investment and Trade Minister of Uzbekistan and Chinese
Ambassador Sun Yux.
The meeting came in the backdrop of India rallying to build bridges
with Central Asian oil producers to secure energy supplies. "The BTC
(Baku-Tbilisi-Ceyhan) is the most recent world class project involving
more than one country. It has the entire documentation written in
English, all of it is posted on the web so we don't have to get to
these people. But it would be nice to hear what they have to say on the
subject and then its for us to draw any lessons if we think there are
any lessons to be drawn," said Aiyar.
Addressing the second round table conference, Aiyar had proposed to
initiate a detailed scientific study to form Asian oil and gas grid.
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Turkmenistan and
China to sign gas deal
Source: The Associated Press by Alexander Vershinin 23-11-05
http://www.gasandoil.com
Central Asia's Turkmenistan will sign a major agreement next year to
sell natural gas to China and jointly develop Turkmen gas fields,
President Saparmurat Niyazov said. China is increasingly looking abroad
to secure reliable oil and gas supplies for its booming economy.
Turkmenistan, a largely desert nation, has huge natural gas reserves
and is the second-largest gas producer in the former Soviet Union after
Russia.
Niyazov said the deal, expected to be signed during his visit to China
early next year, would involve building a gas pipeline to China from
eastern Turkmenistan, where the fields planned for joint extraction are
located. The pipeline will be able to carry 30 bn cm (1 tcf) of natural
gas a year, Niyazov told a meeting of transport officials from former
Soviet republics in the capital Ashgabat.
In July, Turkmenistan and China signed an agreement on oil and gas
cooperation and China extended a $ 24 mm low-interest loan to
Turkmenistan for the development of its oil and gas industry. The
announcement comes days after Niyazov warned Russia and Ukraine that
Turkmenistan can do without their markets if they do not agree to pay
more for gas supplies.
The country, citing increased production costs and higher costs of gas
extraction equipment, is seeking to boost its prices for natural gas
exports by about 35 %. Ukraine relies on Turkmenistan for about 45 % of
its natural gas needs, and was planning to buy about 39 bn cm in 2006.
Russia was expected to buy about 7 bn cm and Iran 8 bn.
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