Daily Archives: March 27, 2012
Senators Call Obama On His Energy Lies
The Obama administration’s energy policies have been a disaster for America. Obama appointed a Secretary of Energy, Steven Chu, who shared Obama’s desire that fossil fuel prices increase, so that it would be more expensive for you to drive your car, heat your home, buy groceries, power your laptop, and so on. Obama wanted higher prices in order to reduce carbon emissions and to enrich the Democratic Party fat cats who dominate the “green” energy industry. The administration has carried out its policy of higher fossil fuel costs by reducing exploration for oil on federal lands, imposing draconian standards on coal-fired power plants, banning normal light bulbs, and countless other measures large and small.
Now, however, Obama’s re-election campaign is in trouble, in large part because voters aren’t happy about being impoverished by Obama’s anti-energy policies. So, in an absurd turnabout, Obama has postured himself as an advocate of “drill, baby, drill.” In order to defend himself, Obama has repeatedly and consistently lied about his own administration’s policies and about America’s energy resources. That is a harsh characterization, but there is simply no other way to put it.
Today, Senators David Vitter, Jeff Sessions and John Cornyn called Obama on his lies in the form of a letter to Secretary of the Interior Ken Salazar. Their indictment is devastating:
Dear Secretary Salazar:
We are concerned with the veracity of statements you made in recent weeks regarding domestic energy production on our federal resources. These statements are similar to claims made by other members of the Administration including the President himself. As you may know, the federal government owns almost 2.5 billion acres of mineral estate, an area larger than the entire land mass of the United States. As director of the Bureau of Land Management, Robert Abbey, testified this month, oil production on our federal property is actually down 14% and offshore production from federal areas is down 17% from only a year ago. Just last week, the Congressional Research Service issued a report revealing that 96 percent of the increase in domestic oil production since 2007 has occurred on non-federal lands. It further revealed that in 2011 production on federal public lands has actually declined by an average of 275,000 barrels per day. Oil production on private lands is indeed up year-over-year, but the Administration does not manage private lands and should not attempt to take credit for private market decisions.
Oil production on federal lands increased in 2009 and 2010 as a result of leasing and permitting decisions made before your Administration took office. However, the falloff in leasing and permitting actions under the Obama Administration is apparent, and even your own Energy Information Administration anticipates continued falloff in production in 2012 and beyond.
We also ask that you rectify the President’s claim that we only have 2% of the world’s oil. Nothing could be further from the truth, as even the Washington Post reported last week. He bases this statement on U.S. “proved reserves” but the U.S. Energy Information Administration has stated that proved reserves is “not an appropriate measure for judging total resource availability in the long-term.” As Secretary of Interior, surely you are aware of the vast oil resources we possess both onshore and offshore that are currently off limits due to this Administration’s combined actions. America is endowed with resources that exceed a TRILLION barrels of oil.
According to the Institute for Energy Research, “USGS estimates that unconventional U.S. oil shale resources hold 2.6 trillion barrels of oil, with about 1 trillion barrels that are considered recoverable under current economic and technological conditions. These 1 trillion barrels are nearly four times the amount of oil resources as Saudi Arabia’s proven oil reserves.
We provide the following examples of what we would view as further inaccurate statements by the Administration regarding the state of federal energy production and resources:
1. Claim: “Expanding offshore oil and gas production is a key component of our comprehensive energy strategy to grow America’s energy economy, and will help us continue to reduce our dependence on foreign oil and create jobs here at home.” Secretary Ken Salazar, DOI Press Release 1/26/2012
Fact: You made the two most pivotal decisions to shrink domestic offshore energy production over the last three years that could have been made. First, you eliminated the 2010-2015 OCS lease plan that would have opened areas of the Atlantic, four geologic basins off S. California, one geologic basin off N. California, while expanding areas in Alaska, including the Cook Inlet. Instead, you have proposed a new 5-year plan that excludes all of the areas of the OCS where the moratorium was lifted in 2008, and reduces the number of planned lease sales by roughly half. Essentially, the moratorium lifted by President Bush and a Democrat Congress in 2008 will continue in effect for a decade under your plan.
2. Claim: The proposed 5-year offshore lease plan will “make more than 75 percent of undiscovered technically recoverable oil and gas estimated on the OCS available for development.” Secretary Salazar, DOI Press Release 11/08/2011
Fact: These numbers distort the facts. The Outer Continental Shelf (OCS) is 1.76 billion acres. Of that 1.76 billion, less than 35 million acres are actually leased (less than 2%). Your proposed 5-year lease plan does not open a single new lease planning area, and therefore we have no way of knowing what estimates of “technologically recoverable” oil in all of the areas that remain off limits are because you have chosen to keep them off limits. Most of our OCS has not been explored for decades, and providing access to only a fraction gives us no clue what is truly there.
A more accurate statement is that your 5 year plan opens 75% of the oil and gas in areas where we think it exists because we have drilled there. We don’t know about the vast majority of the OCS that isn’t leased, much of which has not been assessed with the benefit of new information for a quarter century.
3. Claim: “Since we put in place new safety standards in the wake of the Gulf oil spill, we have approved more than 400 drilling permits. In fact, we are now permitting at levels seen before the spill, all while meeting these important new standards.” Secretary Ken Salazar, 3/12/2012
Fact: There exists no evidence that permitting for production has indeed reached pre-moratorium levels. In fact, the families impacted in the Gulf are still reeling from the impacts of the slowed pace of permitting. Exploration and permitting have yet to recover to pre-2010 levels on account of the moratorium and ensuing permitorium on shallow and deepwater permits. According to one recent study, “Prior to the deepwater drilling moratorium, the U.S. oil and natural gas offshore industry was forecasted to grow significantly due to identified prospects, mostly in the deep water. With the establishment of the moratorium and the subsequent slowdown in the issuance of drilling permits at all water depths, an estimated $18.3 billion of previously planned capital and operational expenditures did not occur in 2010 and 2011.” The study further concludes that the permitting challenges have already cost 90,000 jobs. It is of importance to note that the moratorium was never endorsed by the National Academy of Engineers, as you had attempted to represent. An Inspector General investigation was required to uncover the political influence and misrepresentation by the White House and your office in an important scientific document.
4. Claim: “The fact of the matter is that we are producing more from public lands, both oil and gas, both onshore as well as offshore, than at any time in recent memory. And when you look back at the years of 2009, 2010, and 2011, we’ve continued to make millions and millions of acres of the public estate available both on the land, as well as on the sea.” Secretary Ken Salazar, 3/12/2012
Fact: As we pointed out earlier in this letter, there is significant lag time to production after the process of leasing. Presumably this is the reason for your repeated observation that “there is no immediate fix” for higher gas prices. After a company has leased property they then have to explore, develop and produce, with each stage requiring new permits and compliance with federal processes. The production gains we saw in 2009 and 2010 were the result of leasing and permitting that occurred in the Clinton and Bush Administrations, and was just beginning to come online. However, by 2011 we began to experience the impacts from the moratorium and falloff of leasing and permitting under your leadership. Total oil production on federal lands is down 14% over the previous year, offshore is even worse at down 17%, and federal lands saw the fewest number of new onshore leases since 1984. You also failed to hold a single offshore lease sale in fiscal year 2011.
As a further example, in 2008 the industry spent $2.6 billion to obtain 487 leases in the Chukchi Sea for production offshore Alaska. So far, not a single well has been drilled on any of these leases. There have also been numerous new regulatory roadblocks and permit withdrawals from federal onshore production since you took over leadership of the Agency. Examples of onshore leasing challenges include your withdrawn and slowed leasing in the West, including Montana and the Dakotas.
In July of 2008, then as a United States Senator, you had an opportunity to support increasing domestic energy production, if the price of gas increased beyond a certain threshold. You repeatedly objected to increasing domestic energy production, even if the price of gas were to have reached $10 per gallon.
Although gas prices are not $10 per gallon, they are increasingly impacting our economy and fellow Americans, particularly low-income and middle-class families. We are hopeful that similarly to Secretary Chu, you have reevaluated your position on gas prices and will redirect your efforts to alter what the agency has done to limit future production, and will instead work to develop our truly vast domestic oil resources, resources that well exceed “2%” of the world’s oil.
 NORTH AMERICAN ENERGY INVENTORY, Institute for Energy Research, December, 2011.
 The State of the Offshore U.S. Oil and Gas Industry, An in-depth study of the outlook of the industry investment flows offshore, Quest Offshore Resources, Inc., December 2011.
Of all the reasons why it is imperative to bring the Obama administration to an end in January, its pervasive dishonesty is near the top of the list.
- Obama’s Oily Pipeline Lies (papundits.wordpress.com)
- U.S. Oil Production Increases In Spite of Team Obama’s Best Efforts (pjmedia.com)
- President Obama’s Domestic Energy State Of Delusion (mb50.wordpress.com)
- Obama’s Oil Tycoon Tour (whitehouse12.com)
- Critics Hit Obama’s Energy Move (mb50.wordpress.com)
- Obama’s Words Don’t Match with Action on Oil and Gas (mb50.wordpress.com)
Texas (Austin): Yassine Brothers Funneled Money To Hezbollah
Owners of some of Austin’s most lucrative nightclubs were dealing in drugs, laundering the money through the clubs then funneling it to a family member with ties to a terrorist group in the Middle East, according to federal authorities.
During bond hearings in federal court in Austin Tuesday, an Internal Revenue Service investigator said Hussein “Mike” Ali Yassine and Mohammed “Steve Austin” Ali Yassine sent money in $2,500 increments to their uncle, Mohammed Ishmael in Lebanon.
Authorities say he is associated with Hezbollah, a militant group and political party in Lebanon. The U.S. Department of State lists Hezbollah as a terrorist organization.
The Yassines, their brother, Hadi Ali Yassine and seven business associates were arrested last week on narcotics trafficking, money laundering and firearm charges.
Yassine Enterprises owns nine nightclubs — Pure, Stack, Fuel, Spill, Kiss & Fly, Hyde, Roial, Malaia and Treasure Island. The Texas Alcoholic Beverage Commission has temporarily shut down the clubs.
Tuesday Hussein Ali Yassine and Mohammed Ali Yassine were denied bond. Four were granted bond — Hadi Yassine, Marisse “Madi” Marthe Ruales, Amar Thabet Araf and Sami Derder. No decision has been made on bond requests for Nizar “Nino” Hakiki, Karim Faiq, Edgar Orsini and Alejandro Melendrez.
During three hours of testimony, Assistant U. S. Attorney Gregg Sofer questioned Randall Gillette, special agent with the U. S. Drug Enforcement Agency and James Neff, criminal investigator with the Internal Revenue Service.
The agents explained its undercover sting operation in which a confidential source was used to arrange two sales of cocaine between Steve Yassine and Nizar Hakiki. The agents testified the proceeds from the deals were then funneled through Yassine`s nightclubs and Famous Vodka, owned by Hadi Yassine, the third brother.
Neff also stated in the hearing that the business was reporting income of $1 to $2 million when it actually was taking in between $7 and $10 million.
According to testimony, the Texas Comptroller‘s Office has frozen Mike Yassine’s accounts. It was also revealed that he has bank accounts in Switzerland and Lebanon.
Several of the defendants are under investigation by U.S. Immigration and Customs Enforcement.
- Popular Austin Clubs Shut Down Due To Owners Arrest (dayandadream.com)
- Concerns grow over Hezbollah fundraising in the US (charlotte.news14.com)
- Welcome to Mleeta, Hezbollah’s premier tourist trap [Modern Ruins] (io9.com)
- US adds IMU, IJU operatives to list of global terrorists (longwarjournal.org)
- Congressional Report: Hezbollah has “several thousand” donors in the USA (iamiranaware.wordpress.com)
Critics Hit Obama’s Energy Move
President Obama’s recent invitation to open an area in Alaska to energy drilling is playing to poor reviews from industry leaders and administration critics, who say the move is an attempt to mislead the public about the administration’s willingness to open federal lands to more oil and gas production.
Over the weekend during a brief refueling stop in Alaska on the way to the nuclear summit in Seoul, Mr. Obama issued a release inviting industry input on an oil and gas lease sale in Alaska’s Cook Inlet.
“Today’s announcement is part of our commitment to increasing safe and responsible domestic oil and gas production as part of an all-of-the-above energy strategy for America,” said Secretary of the Interior Kenneth L. Salazar. “We will continue to support efforts to safely expand offshore oil and gas exploration, using the best science to assess where recoverable resources lie and providing industry with abundant opportunity to lease and develop areas that contain those resources.”
But the Cook Inlet, off the coast of South-Central Alaska is the oldest oil field in the state, dating back to the early 1960s, and industry organizations are ridiculing the move as an attempt to try to dress up an old leasing area the industry has had little to no interest in drilling in for years. In fact, two previous Cook Inlet sales in 2009 and 2011 were either canceled or put on hold because of lack of industry interest.
“Oil production has been tapering off there – that’s true for any old oil field,” said Benjamin Cole of the industry-funded Institute for Energy Research. “It’s not economic for the industry to put oil wells there.”
Mr. Cole compared the administration’s lease sale offer in the Cook Inlet to a used-car dealer offering a 1962 Ford with 350,000 miles on it.
“It may be a good car, may have been a good car for all those people who learned to drive on it, but it may not make economic sense to lease it again,” he said.
A spokesman for the House Natural Resources Committee said the panel would not have an official response but argued this “latest political move is really much ado about nothing.”
The Cook Inlet lease sale was part of President George W. Bush’s 2007-12 plan for drilling in the outer continental shelf, which the Obama administration canceled and then delayed coming up with its own five-year proposal until last year.
“This is another case of President Obama canceling a lease sale that was scheduled by a previous administration and then trying to take credit for possibly allowing it to happen,” said committee spokesman Spencer Pederson. “Also, the Cook Inlet is mostly natural gas, so if the administration is using this to distract Americans from noticing gasoline prices have doubled under President Obama, House Republicans have a list of places we would suggest the administration open for American oil production to help lower prices at the pump.”
A Department of Interior spokeswoman declined to comment on the claims about the Cook Inlet, but pointed to an Interior Department estimate that the area could contain more than 1 billion barrels of undiscovered oil and 1.2 trillion cubic feet of natural gas.
The same report estimated another area off Alaska, the Chukchi Sea, could contain an estimated 15.4 billion barrels of oil and 76.8 trillion cubic feet of natural gas.
ConocoPhillips Alaska operates the Kenai liquefied natural gas export terminal in the Cook Inlet Area and has expressed interest in the drilling in the Interior Department’s latest lease sale opportunity.
In contrast, oil companies jumped at the chance to drill in the Chukchi Sea when the Bush administration offered a lease sale for a portion of it in 2008.
But more than a dozen environmental organizations have tried to derail drilling in the Chukchi Sea scheduled to start in July by challenging the drilling plans of companies such as Royal Dutch Shell in court.
Sabrina Fang, a spokeswoman for the American Petroleum Institute, says the industry has only marginal interest in the Cook Inlet and would much prefer to see more permitting opportunities in the Chukchi Seas, as well as Beaufort Sea, another area off Northern Alaska, which is home to one of the largest colonies of Beluga whales.
“Leasing in areas that have been available for years is not the forward-thinking energy policy needed to increase future energy security,” Ms. Fang said. “If the administration was serious about Alaska oil and gas exploration, then they would schedule lease sales in these areas before 2015 and 2016.”
- BOEM: Conditional Approval for Shell’s Chukchi Sea Exploration Plan (USA) (mb50.wordpress.com)
- USA: Shell’s Chukchi Sea Oil Spill Response Plan Approved (mb50.wordpress.com)
U.S. seeks missile-defense shields for Asia, Mideast
(Reuters) – The United States is seeking to build regional shields against ballistic missiles in both Asia and the Middle East akin to a controversial defense system in Europe, a senior Pentagon official disclosed on Monday.
The effort may complicate U.S. ties with Russia and China, both of which fear such defenses could harm their security even though the United States says they are designed only to protect against states like Iran and North Korea.
The U.S. push for new anti-missile bulwarks includes two sets of trilateral dialogues – one with Japan and Australia and the other with Japan and South Korea, said Madelyn Creedon, an assistant secretary of defense for global strategic affairs.
Such shields could help counter perceived threats to their neighbors from Iran and North Korea and help defend the United States from any future long-range missiles that the two countries might develop, she told a conference co-hosted by the Pentagon’s Missile Defense Agency.
The model would be the so-called “phased adaptive approach” for missile defense in Europe, Creedon said. This includes putting interceptor missiles in Poland and Romania, a radar in Turkey and the home-porting of missile defense-capable Aegis destroyers in Spain.
Moscow fears that such a shield, given planned upgrades, could grow strong enough by 2020 to undermine Moscow’s own nuclear deterrent force. It has threatened to deploy missiles to overcome the shield and potentially target missile defense installations such as those planned in NATO members Poland and Romania.
China likely would be even more opposed to an antimissile shield in its backyard, said Riki Ellison, a prominent missile-defense advocate noted for his close ties to current and former U.S. senior military officials involved in the effort.
Beijing “would take much more offense to an Asian phased adaptive approach than Russia is doing with the European one,” he said, calling regional shields a good idea in theory but problematic in reality.
In the Middle East, Creedon said Washington will work to promote “interoperability and information-sharing” among the members of the Gulf Cooperation Council – Saudi Arabia, Kuwait, Bahrain, Qatar, the United Arab Emirates and Oman – as they acquire greater missile-defense capabilities.
The biggest U.S. missile defense contractors include Boeing Co, Lockheed Martin Corp, Raytheon Co and Northrop Grumman Corp.
The Obama administration at the same time stepped back from an announcement this month that it was weighing the possibility of giving Russia certain classified missile-defense data as the price for winning its acquiescence to the European shield.
“We are not proposing to provide them with classified information,” Ellen Tauscher, the administration’s special envoy for strategic stability and missile defense, told the conference. Instead, she said, the Obama administration had offered Moscow a chance to monitor a flight test in international waters of a U.S. Standard Missile-3 interceptor.
This, she said, would let Russian officials see for themselves the accuracy of “what we are saying about our system.” The United States argues that the U.S. system poses no threat to Russia’s nuclear deterrent.
As recently as March 6, the administration had said it was continuing negotiations begun under former President George W. Bush on a pact with Moscow that could include sharing limited classified data, but said it was making no headway toward a deal with Russia.
Obama’s administration was not the first “to believe that cooperation could be well-served by some limited sharing of classified information of a certain kind if the proper rules were in place to do that,” Bradley Roberts, a deputy assistant secretary of defense, had told the House of Representatives’ Armed Services subcommittee on strategic forces at the time.
The idea of such data-sharing drew sharp criticism from Republicans in the U.S. Congress including a move to legislate a prohibition.
The rollback on any such deal involving classified data exchange came after President Barack Obama was caught on camera on Monday assuring outgoing Russian President Dmitry Medvedev that he would have “more flexibility” to deal with contentious issues like missile defense after the November 6 U.S. presidential election.
Obama, during talks in Seoul, urged Moscow to give him “space” until after the vote, and Medvedev said he would relay the message to Russian President-elect Vladimir Putin.
(with additional reporting by Andrea Shalal-Esa; Editing by Eric Beech)
- Obama seeks to defuse controversy on missile comments (mb50.wordpress.com)
- President Obama Asks Medvedev for ‘Space’ on Missile Defense – ‘After My Election I Have More Flexibility’ (mb50.wordpress.com)
Shell Orders Subsea Connection Systems from Aker Solutions (Norway)
Aker Solutions has been awarded a contract by A/S Norske Shell, to deliver subsea connection systems for the Draugen field on the Norwegian continental shelf. Contract value is approximately NOK 105 million.
Scope of work includes the delivery of complete tie-in connection systems for production flowlines and umbilicals for the expansion of the Draugen field.
“Aker Solutions has supplied connection systems for the subsea installations on the Draugen field since 2002. We are pleased that we can continue to assist A/S Norske Shell to expand the field and increase the production with our solutions,” says Alan Brunnen, executive vice president of Aker Solutions’ subsea business area.
Management, engineering and procurement of the connection systems will be performed at Aker Solutions’ head office in Fornebu, Norway. Equipment deliveries will be made from 2012 to 2013.
The Draugen field is located in block 6407/9 in the Haltenbanken area of the Norwegian Sea, which is situated about 140 kilometres from Kristiansund, Norway, at a sea depth of 250 metres.
- Norway: Aker Solutions Secures Draupne FEED Contract (mb50.wordpress.com)
- Norway: Aker Solutions Delivers Subsea Templates for Skuld Fast-Track Development (mb50.wordpress.com)
- Aker Solutions to Design World’s Largest Spar Platform for Statoil (mb50.wordpress.com)
- Ghana: Aker Solutions Signs Well Service Contract with Tullow (mb50.wordpress.com)
- USA: Aker Solutions to Provide Umbilicals for Anadarko’s Lucius Development (mb50.wordpress.com)
Europe Needs a Roadmap for Unconventional Gas
As the unconventional gas “revolution” was quietly unfolding in the United States, its potential to transform the U.S. gas market, and the country’s national energy discourse, was not apparent until recently. It has now become clear that shale gas development is perhaps the biggest energy sector innovation for the United States in recent decades. For Europe, however, the role shale gas will play in transforming energy markets is far from certain. The old continent’s unconventional gas reserves are substantial, but the question is how fast and to what extent Europe will develop them.
Europe needs a clear roadmap for the prospects of unconventional gas in its energy future. The current situation calls for an approach that is based on realistic expectations about the pace of shale gas development, as well as a strategy that is well-informed about potential costs and benefits. Continuing uncertainty could not only hamper the flow of investment into potential unconventional gas reserves, but could also impede the development of informed plans about Europe’s energy security and ability to fight climate change.
To begin with, it is worth recognizing Europe’s limitations. The combination of factors that led to the unconventional gas “revolution” in the United States—favorable geology, developed gas markets, and until recently, limited regulatory and public constraints—is not easy to replicate. Geologically, knowledge of unconventional gas in Europe does not go much beyond rough estimates. Where exactly are the shale deposits located? At what depth? And in what type of formations? At what cost could they be extracted? Europe still needs to start mapping out its shale gas reserves—a process that started almost three decades ago in the United States. At this point all that is known is that there are sufficient reserves to transform Europe’s gas market. Estimates vary but they consistently put the European Union’s unconventional reserves well above its conventional ones. Knowing this alone, however, is not enough.
The cost of developing shale gas reserves will be a principal factor in determining the future of unconventional gas in Europe. The sharp growth in shale gas output in the United States owes much to the considerable cost reduction witnessed over the past decades. Europe stands at the beginning of that process. Lack of comprehensive geological knowledge about shale precludes a precise estimate, though costs are expected to be high not least because of the scattered nature of reserves in Europe. The absence of a vibrant services sector for the gas market presents another bottleneck. The European gas sector’s limited capacity to provide cost-effective equipment for shale gas development along with a shortage of qualified labor will undoubtedly lead to higher development costs than in the United States. Costs can certainly go down, just like they did in the United States, as the industry gradually reacts to the needs of the market. But initial costs will pose a challenge.
In its quiet “revolution,” America’s unconventional gas industry outpaced both the regulators and the public. By the time stringent environmental demands became part of the national energy discourse, unconventional gas had already assumed its transformative role in the U.S. gas sector.
In Europe, if this revolution is ever to be repeated, it will not be a quiet one. The rigorous environmental regulations that are already in place—particularly with regard to water use—are prompting investors to think twice about managing costs before they commit. With their high population density, many European governments are less willing to embrace shale gas before its environmental impacts become apparent. In many countries, particularly in Western Europe, governments ignore environmental movements at their own peril. More investment in shale development will almost certainly have to confront calls for even stricter ecological requirements.
The EU’s energy and climate policy needs to recognize these constraints. It would be unrealistic to expect shale gas to be a panacea for the Union’s growing concerns on energy security and climate mitigation. This is true at least in the short and medium term.
And yet, discounting the potential role of unconventional gas in Europe’s future would be a mistake. It is in the EU’s long-term interest to maintain a role for shale gas development. Most industry insiders argue that unconventional gas will not contribute in any significant form to Europe’s energy supply until at least the end of this decade. Its role beyond that point, however, is anyone’s guess. How fast Europe develops these resources depends on today’s policy choices.
European policymakers should give shale gas development a chance. First, as a latecomer compared to the United States, Europe is more likely to find a way to develop its unconventional resources in an environmentally friendly fashion. Stricter regulations and low public tolerance for potential environmental risks may slow the pace of shale gas development. They can, however, also ensure that Europe develops these resources in the right way, avoiding some of the mistakes witnessed in America.
Second, the benefits of shale gas development could be disproportionately large. European gas supplies are in decline, while demand is expected to continue to grow. The EU’s ever growing need for imported gas is compounded by its dependence on a rather small number of external suppliers—Russia, Norway, and Algeria account for nearly three quarters of Europe’s imports. It is not certain that unconventional gas can reverse the decline in domestic gas output. However, it could certainly enhance the position of European importers when bargaining with their limited number of suppliers. Most recently, gas sold at spot markets, which constitutes only a fraction of total gas imports in Europe, effectively served such a role. Even Gazprom, known for its firm bargaining position, felt the need to revise a portion of its contracts. Shale gas could play a similar role for European importers in the future by enhancing competition. Increased liquefied natural gas (LNG) imports could potentially have a similar impact. But, they will be need to be sourced from outside the EU, maintaining Europe’s dependence on global LNG market trends.
Even if unconventional gas is not a “game changer” for Europe as a whole, it could be a “game changer” for a select group of EU members. Ironically, some of the countries with greater prospects for shale gas development—Poland, Hungary, and Bulgaria—are among the most dependent on Russian gas.
At this point, the future of shale gas in Europe is very much in the hands of national governments. Legal competence for hydrocarbon development is mainly within the domain of these governments rather than Brussels. What they need is a well-informed national discourse on unconventional gas that involves all the main stakeholders. In effect, they need to avoid what France recently did—a rushed decision outlawing hydraulic fracturing—and instead attempt to fully assess the potential for developing shale gas while complying with strict environmental standards.
Brussels, on the other hand, does have a role to play. In addition to ensuring higher environmental standards, it could attempt to bring greater clarity about the future of natural gas in Europe’s energy balance. Mixed signals about its expected role have understandably preoccupied investors. Also, it could elaborate investment mechanisms for shale gas development that would serve its long-term decarbonization objectives by displacing more carbon-intensive sources of energy. Ultimately, Brussels should make certain that Europe does not miss this opportunity to seize the strategic potential offered by unconventional gas.
Adnan Vatansever is a senior associate in the Energy and Climate Program at the Carnegie Endowment. This article was originally published on Carnegie Europe’s website
- Poland detains 7 suspected of shale gas corruption (reuters.com)
- IEA to make shale gas regulatory recommendations (business.financialpost.com)
- Shale boom in Europe fades as Polish wells come up empty (business.financialpost.com)
- Fracking could bring UK 50,000 jobs, says Browne (independent.co.uk)
Canada: Subsea 7 Receives Terra Nova Field SURF Contract
Subsea 7 S.A. announced the award of a SURF contract valued at approximately $100 million from Suncor Energy on the Terra Nova Field, situated 350km south east of St John’s, Newfoundland, offshore Canada.
The contract scope includes the management, engineering and installation of nine 300 metre replacement risers and associated flowlines, jumpers and tie-ins.
Engineering and project management will commence immediately at Subsea 7’s St John’s office, with offshore operations due to commence in summer 2012 utilising Subsea 7’s world-class construction and diving vessels.
Phil Simons, Subsea 7’s Vice President Canada, Mediterranean & Russia said, “As a leading seabed-to-surface engineering, offshore construction and services company we are delighted to have won this prestigious contract which builds on our expertise and strong track record and further supports the development of our St. John’s office.”
- Singapore: EMAS Achieves Record Order Book with New Contracts (mb50.wordpress.com)
- STX OSV Adds to their Backlog, DOF ASA Sends Newbuild Order for Subsea Construction Vessel (mb50.wordpress.com)
- USA: Genesis to Support Shell’s SURF Projects (mb50.wordpress.com)
- Norway: Statoil Orders Subsea Structures for Asgard (mb50.wordpress.com)
- Australia: Heerema Wins Subsea Installation Contract for Ichthys Project (mb50.wordpress.com)
- Norway: Technip to Install Subsea Compression System on Asgard (mb50.wordpress.com)
Obama seeks to defuse controversy on missile comments
Posted by mb50
By Matt Spetalnick SEOUL | Tue Mar 27, 2012 2:59am EDT
(Reuters) – President Barack Obama voiced doubt on Tuesday on the prospects for progress with Moscow on missile defense until after the November U.S. election as he staunchly defended remarks caught on camera the day before with Russian President Dmitry Medvedev.
Obama was overheard assuring Medvedev on Monday that he would have “more flexibility” to deal with contentious arms-control issues after the November 6 presidential ballot, drawing sharp criticism back home from his Republican foes.
Speaking on the sidelines of a global nuclear security summit in Seoul, Obama sought to put the controversy to rest but made clear that his earlier comments reflected a political reality that “everybody understands.”
“I don’t think it’s any surprise that you can’t start that a few months before presidential and congressional elections in the United States and at a time when they just completed elections in Russia,” Obama told reporters with Medvedev at his side.
U.S. plans for an anti-missile shield have bedeviled relations between Washington and Moscow despite Obama’s “reset” in ties between the former Cold War foes. Obama’s Republican opponents have accused him of being too open to concessions to Russia on the issue.
In Monday’s talks, Obama urged Moscow to give him “space” until after the U.S. election and Medvedev said he would relay the message to incoming Russian president Vladimir Putin, who takes over at the Kremlin in May.
The unusual exchange came as Obama and Medvedev huddled together on the eve of the summit, unaware their words were being picked up by microphones as reporters were led into the room.
It was a rare public admission by a U.S. president on the world stage of electoral pressures he faced at home, and threatened to detract from his message at the summit on the need to do more to combat the threat of nuclear terrorism.
Obama, responding to a reporter’s question on Tuesday during a break in the summit, said progress on complex arms control issues required dealings with the Pentagon and Congress to build bipartisan support and that 2012 was not a good year to get that done.
“The current environment is not conducive to these kinds of thoughtful consultations,” Obama said. “I think we’ll do better in 2013.”
The Democratic president has faced stiff opposition from Republicans in Congress to his legislative agenda on everything from job creation to taxes. Republicans have already made clear they have no interest in cooperating on further arms reduction deals with Russia.
Republican presidential candidate Mitt Romney seized on Obama’s earlier comment, calling it “alarming and troubling.”
“This is no time for our president to be pulling his punches with the American people,” Romney said in a campaign speech in San Diego.
But Obama pushed back, insisting he was not trying to “hide the ball” and had no hidden agenda with Russia over the planned missile shield. Obama, in a speech on Monday, vowed to pursue more arms-control deals with Moscow as part of his broader nuclear disarmament agenda.
As he was leaning toward Medvedev in Seoul on Monday, Obama was overheard asking for time – “particularly with missile defense” – until he is in a better position politically to resolve such issues.
“I understand your message about space,” replied Medvedev.
“This is my last election … After my election I have more flexibility,” Obama said, expressing confidence that he would win a second term.
“I will transmit this information to Vladimir,” said Medvedev, Putin’s protege and long considered number two in Moscow’s power structure.
The United States and NATO have offered Russia a role in the project to create an anti-ballistic shield which includes participation by Romania, Poland, Turkey and Spain.
But Moscow says it fears the system could weaken Russia by gaining the capability to shoot down the nuclear missiles it relies on as a deterrent.
It wants a legally binding pledge from the United States that Russia’s nuclear forces would not be targeted by the system and joint control of how it is used.
(Additional reporting by Alexei Anishchuk and Alister Bull in Seoul, Steve Holland in San Diego, Editing by Nick Macfie)
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