Publications

What are market expectations for European traded gas prices? What has happened since the beginning of 2010? How and why has seasonality changed?

The power sector in North Africa is the main driver of gas consumption in exporting countries Algeria, Egypt and Libya, as well as in transit states Tunisia and Morocco. With demand for electricity expected to continue on its upward trend in the medium term, exporting countries are facing pressure on their export expansion plans, while Morocco and Tunisia have to make tough decisions to secure future supplies. Internal reforms are also needed to attract more investments in power projects and the stalemate over the removal of artificially low domestic prices is a prime example of the difficulties ahead.

Woodside Petroleum’s plan to sanction the first expansion phase of the Pluto LNG project in Western Australia by the end of 2010 has now officially fallen by the wayside, as many observers had expected. In its half year results published last week, Woodside said slower than expected progress with its 20-well drilling program to find reserves to underpin Pluto’s expansion had forced the company to delay FID until early next year.

The centre of gravity of Russian gas production is likely to start moving northwards to the Yamal peninsula in two years’ time. Senior Gazprom executives insist that first gas from the first Yamal field to come on stream, Bovanenkovo, will flow in the third quarter of 2012, and work continues apace on the gargantuan Bovanenkovo-Ukhta transport link that will carry Yamal peninsula gas towards Europe. But Yamal production is likely to be ramped up more slowly than had previously been planned. The investment required for Yamal is so huge and uncertainty about demand so persistent in domestic and export markets that brakes could be put on the peninsula’s expansion, highlighting the need to find alternative options to bridge the production gap.

The growing share of shale gas in the US energy supply portfolio has intensified talks on the role natural gas can play in mitigating climate change in the country. The Massachusetts Institute of Technology (MIT) published “The Future of Natural Gas” this summer, a report highlighting the need to establish a carbon pricing system, the cost of low-carbon technologies and the benefits of a global gas market despite increased access to shale gas resources in the US. Gas Matters talked to Tony Meggs, a member of the Energy Initiative group at the MIT.

The search for shale gas in Europe is now making the headlines as many oil and gas firms are hoping to replicate the US shale success story. However, as one geologist pointed out, Europe is looking at its own shale gas resources with a US eye and it is a much different scenario in Europe, where the development of shale gas is likely to follow a significantly different path. Poland has taken the lead with the first European well, the Markowola-1 with hydraulic fracturing of a potential shale reservoir drilled this summer for PGNiG the state-owned Polish oil and gas company. But challenges in Europe are plenty, and it remains to be seen whether Poland will set a precedent for the rest of the continent and what that precedent will be.

Shah Deniz or bust?

We’ve read the press releases, sat through the bullish presentations and listened to visions of a non-Russian pipeline delivering “security of supply” to Europe. And now, with the fate of an estimated 10 Bcm/yr of Shah Deniz phase II gas about to be decided, the moment of reckoning has arrived for Europe’s fourth gas corridor.

In the first of what will be a regular series of short articles looking back at “historic” issues of Gas Matters, we look back at the September 20, 1988 issue. What was preoccupying Gas Matters back in September 1988? The issue was 16 pages long, produced on paper, and had only three articles plus a statistics section. It had a phone, a telefax and a telex number, but no e-mail address and no website. And “All gas matters are dealt with by James Ball”.