Back Seat Driving

http://www.adn.com/opinion/guest_columns/story/7408760p-7320829c.html Gas line should be built on our terms By TONY KNOWLES

Why oh why does this guy keep giving opinions on what is in the best interest of Alaskans. Was not the Performing Arts Center a lesson?

The money quote:

Since 2002, there has been a significant structural change in worldwide natural gas supply and demand, with the price of natural gas almost five times its previous level. This change puts Alaska in the driver's seat. Projects previously uneconomical are now considered extraordinarily profitable.

Alaska is not in the driver's seat. The cost of building the gas line is hugely expensive when looked at and compared to other projects abroad.

December 9 2005 16:30

GAZPROM LAUNCHES CONSTRUCTION OF ONSHORE SECTION OF NORTH EUROPEAN GAS PIPELINE


NEGP

The first joint of the Russian onshore section of the North European Gas Pipeline has been welded today in the town of Babayevo (Vologda region).

Attending the event were Mikhail Fradkov, Chairman of the Government of the Russian Federation, Michael Glos, Economy Minister of Germany, Alexey Miller, Chairman of Gazprom’s Management Committee, Jurgen Hambrecht, Chairman of the Board of Executive Directors of BASF AG and Wulf Bernotat, Chairman of the Board of Management & CEO of E.ON AG.

NEGP’s offshore section will be engineered, constructed and operated by North European Gas Pipeline Company incorporated on 30 November 2005 in the canton of Zug (Switzerland) by Gazprom (51%), BASF AG (24.5%) and E.ON AG (24.5%).

“Today we’ve started establishing a cardinally new route for natural gas transmission. Projected over a long term and aimed at meeting the united Europe’s soaring needs in Russian gas, the North European Gas Pipeline will substantially enhance the reliability and flexibility of gas deliveries from Russia. Gazprom’s long-lasting experience of operations in the gas business as well as our alliance with the prominent German companies BASF and E.ON are the keystones for our success, with the foundation of a special purpose Gazprom, BASF and E.ON joint venture being undoubtedly a landmark event in this regard,” maintained Alexey Miller.

“For so far 15 years BASF and Gazprom have been successfully working as a team in the gas trading sector. In 2003 we launched joint business in the geological exploration and production sectors. By now intensifying our partnership ties, we’re making another contribution into prospective natural gas supply of Europe along the entire value chain, from a Siberian drilling well to a European end-user,” said Jurgen Hambrecht.

“Welding the first joint of a gas pipeline from Russia to Germany is a symbolically meaningful event. Our reliable partnership ties in the energy sector have been a connecting bridge between Russia and Germany over many decades. Our countries have close relationships and have managed to find the best way to understand each other. The North European Gas Pipeline construction under the Baltic Sea will be another crucial step towards promoting our cooperation,” stated Wulf Bernotat.

Reference:

The North European Gas Pipeline (NEGP) is a fundamentally new route for Russian gas exports to Europe. Targeting at Germany, the Great Britain, the Netherlands, France and Denmark, NEGP is of great significance for meeting Europe’s soaring gas demand.

Back in December 2000 the European Commission resolved to award the NEGP Project with the TEN (Trans European Networks) Status.

With no transiting countries along its route, which excludes any potential political risks, NEGP will directly link the United Gas Transmission System (UGTS) of Russia with the European gas network and will ensure the utmost in reliable gas deliveries to West European consumers. Additionally NEGP will play a special role in providing abundant gas supply to the Kaliningrad region.

To link NEGP with UGTS of Russia, a 917-km-long Gryazovets-Vyborg gas pipeline will be built through the Vologda and Leningrad regions. Commissioning this pipeline will also help meet growing gas requirements of St. Petersburg and the Leningrad region.

To be built in the Portovaya Bay (near the town of Vyborg, Leningrad region), an onshore compressor station will be a starting point for NEGP’s offshore section (1,198 km) that will run under the Baltic Sea to Greifswald (Germany) with a potentail gas lateral to Sweden and then will go across Germany and the Netherlands to Bacton (the Great Britain).

NEGP’s working pressure will account for 210 Ata. With its nominal capacity to reach 27.5 bcm/y, the first line of NEGP is slated for 2010. Upon construction of the second line, NEGP’s design capacity will double to 55 bcm per annum.

NEGP will carry gas to be withdrawn from UGTS.

An eight-member Shareholders Committee has been set up to operate the North European Gas Pipeline Company joint venture.

The construction of NEGP will meet the most rigid environmental standards and won’t disrupt the Baltic Sea ecosystem.

The costs of this line? Estimated cost, 10 billion. And the Alaska/Canadian line will costs what? 20 billion?

What about Gazprom?

http://www.iht.com/articles/2005/12/13/business/gazprom.php Gazprom is seeking a foothold in the U.S.

Alexander Medvedev, deputy chairman of Gazprom, said during an interview 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 needs, 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 shortlist 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.

There is more.

http://www.bellona.no/en/energy/41209.html

Shtokman gas to be supplied to Europe via Baltic pipeline

Natural gas from the giant Shtokman field on a Barents Sea shelf in Russia's north will be delivered to Europe via various routes, including through the 745-mile Baltic Sea natural gas pipeline.

2005-12-12 11:31

"The pipeline will be built in the second phase of the Shtokman field development and natural gas will be pumped, including by the North European Gas Pipeline (NEGP)," CEO of the state-owned giant Alexei Miller said.

Miller said the Yuzhno-Russkoye deposit in northern Russia, which had been chosen as the main source of natural gas to be pumped by the NEGP, would provide the necessary amount of gas, RIA Novosti reported.

Valery Golubev, head of Gazkomplektimpeks, Gazprom's subsidiary that supplies material and equipment for natural gas and oil facilities under construction, said two legs would be built to pump gas from Yuzhno-Russkoye to Vyborg on Russia's Baltic coast, where the Baltic pipeline will begin.

Golubev said that if a decision was made to pump natural gas via the NEGP from Shtokman, with estimated reserves of 3.2 trillion cu m of gas and 31 million metric tons of gas condensate, two legs would connect the deposit to Vyborg.

Production at Shtokman will begin in 2010 and achieve its full capacity in 2011-2012 and liquefied natural gas (25%) will be delivered to the United States and Europe.

The project is estimated at $10 billion.

http://archive.gulfnews.com/articles/06/01/20/10012801.html Gazprom to send more LNG cargoes to the United States

Berlin: Russian gas giant Gazprom plans to ship at least six cargoes of liquefied natural gas to the United States this year in a partnership with energy major Shell, a top executive said yesterday.

"We are planning to deliver a minimum six cargoes of LNG [liquefied natural gas] this year,"

Alexander Medvedev, deputy chief executive officer of Gazprom told reporters.

LNG is gas which has been cooled into liquid form for easy transport by tanker.

A single ship can deliver enough gas to supply London for a week.

Gazprom entered the global LNG market last year when it sent two shipments to the United States.

The company does not produce any LNG of its own and acquired those cargoes in swap deals in return for pipeline gas deliveries in Europe.

These two cargoes were delivered to an import terminal at Cove Point in Maryland on the US east coast where Shell owns regasification capacity.

Gazprom has multiple LNG projects, all of which are set to come on stream at the end of this decade.

The company has said it is keen to carry out swaps to learn more about the LNG business.

The facts on LNG exporters.

http://www.eia.doe.gov/oiaf/analysispaper/global/exporters.html

Tony Knowles has shown his political will and his ignorance on where Alaska is sitting in the world market on LNG.

Alaska is definately not in the driver's seat. And Knowles is like the child in the back seat that keeps asking "are we there yet."