P18. Pick Points

Haf-a-dozen or so stories of interest:

For some unknown reason the Russian news site, Kommersant, has stopped publishing in English, and so I fall back on Pravda to find the Russian thinking on the ongoing dispute with Ukraine. It is shall we say “a less diplomatic” site. In quoting the Naftogas (Ukrainian gas company) Chairman Oleg Dubina, it carefully points out that in Russian Dubina means “crack-head.” While stating that the current situation is brought about by Ukrainian attitudes, it also points out that Gazprom has bought all the production of the Asian countries (it means Turkmenistan, Azerbaijan and Kazakhstan), and points out that the supply from Azerbaijan would only produce enough gas to supply Turkey. Last week Ukraine said that it would use its own supplies to provide for Bulgaria and Moldova , but it turns out that Moldova, at least, though cut off from January 4th, is now getting gas from Russia, after, earlier getting gas from Ukraine. They are, however, paying Russia the going European price for it, and they are not getting all they need, but at least enough to open the schools. But if I read the different reports correctly the gas that Moldava is now getting from Russia transits Ukraine first. Perhaps I had better not ask . . . .

In regard to the dispute itself Ukraine plans on getting their Summit on the gas war in today (Friday) and then the Prime Ministers of Russia and Ukraine will meet in Moscow on Saturday, perhaps with the EU Energy Minister in attendance. Ukraine is claiming to demand a much better definition of what will be supplied where, though they are quite specific on what they want. In the meanwhile France Italy and Austria are offering to put up for the gas for Ukraine to “run the system” providing that gas can pass through the lines to Europe. They’ll argue about who is going to pay for it later.

In the rest of the world Canada is beginning to appreciate the potential of the natural gas that can be found in shales similar to those of the US. The Horn River formation is showing high potential reserves, with production costs estimated to be covered at a $7 per thousand cu ft price, though the estimated price per well in Canada is $7 - $10 million.

Pakistan is not getting much help from Iran on their gas supply problems and the domestic supply, which comes from Balochistan, is increasingly under threat. It does not help that Balochistan has become a theater of operations for al-Qaeda. To add to the problem there is a lack of hydropower, water flow from the high dams at Tarbela and Mangla having been stopped.

And in news closer to home I do note that Energy Bulletin (which has been kind enough to publish my articles on occasion) is now joining the Post Carbon Institute team. I wish them both well in this new step. Given that Rigzone is predicting $200 a barrel oil soon, based on declining US production, the willingness to spend to extract deep water oil and population growth I suspect we will all remain glad they are around to help us understand this growingly complex situation.

As usual there are more stories to be found at The Energy Bulletin, and at Drumbeat in The Oil Drum,