By Sujoyini Mandal and Marika Semerdzhian
Gazprom’s traditional economic and strategic business models are coming under tremendous pressure. Shifting LNG trade patterns are impacting spot markets in Europe and Asia, partly as a result of the shale gas boom in the US; lack of investment in new fields is depleting Russia’s gas reserves; and Russia’s domestic gas market is facing market pressures from liberalisation.
There is no doubt that Russia remains a central player in the global energy sector. Vertically integrated, Gazprom controls about half of the country’s proved reserves of natural gas and its export monopoly is enshrined in law. This could change very soon. Gazprom experienced a difficult 2012, with net profits falling by a third in the first half of the year. This comes in the wake of a weaker demand from Europe caused by the economic crisis and perhaps unwillingness to put up with the gas giant. In spite of these challenges, we believe Gazprom is actually positioned to take advantage of, rather than suffer from, rapid changes in the energy industry, both at home and abroad. Here is why. Continue reading »
The Russian parliament dealt Gazprom a blow on Friday, passing legislation that will allow independent gas producers to export liquefied natural gas.
But read the small print of the law and it’s not as bad for Russia’s natural gas monopoly as it sounds. Only two independents will be permitted to muscle into the LNG export business and the scope of their operations will be limited to specific gas fields. Continue reading »
You might think that splashing out $55bn on TNK-BP would have slaked Rosneft’s thirst for mergers and acquisitions. But the Russian state oil company has decided to buy a stake in an Italian refinery to bolster its position in European energy markets.
Rosneft said this week it would buy shares in the Saras refinery, in a two-phase acquisition that will see the Russian company take control of up to 21 per cent of Europe’s sixth biggest oil processing plant. Continue reading »
Japan’s thirst for liquefied natural gas is well known. Since the world’s third largest economy shut down almost all of its nuclear reactors following the Fukushima disaster last year, imports of the relatively clean-burning fuel have risen sharply, as utilities have scrambled for shipments anywhere they can find them. Even Belgium – a non-producing nation – showed up in Japan’s official list of LNG suppliers this year, after it re-routed tankers that had already passed customs.
Less well appreciated, however, is Africa’s vital role in meeting that demand. Continue reading »
Courtesy of Ukraine's Cabinet of Ministers
From the PR viewpoint, things went terribly wrong for Ukraine during an energy deal signing ceremony on Monday, intended in part to demonstrate to Russia’s Gazprom that Kiev was moving fast to build its first LNG terminal, and had big backers – and thereby give the country leverage in negotiations over gas prices.
Tragically, the much-sought-after leverage evaporated after a Spanish “negotiator” Jordi Sarda Bonvehi breached authority by signing a non-binding co-operation agreement with Ukraine on behalf of Gas Natural Fenosa, causing all sorts of bother, as reported by beyondbrics. Continue reading »
Qatar is positioning itself to sell liquefied natural gas to Egypt as it uses its financial firepower to cement its ties with Egypt’s new Islamist leadership in a time of unprecedented economic instability, writes Camilla Hall.
The world’s biggest exporter of LNG signed a joint venture with Egyptian private equity firm Citadel Capital last Thursday to build a floating LNG storage facility and re-gasification unit to deliver natural gas to Egypt. Continue reading »
Russian rail assets are changing hands at high speed as the government relinquishes its grip on the sector and new, privately-owned players compete for ownership of railcar fleets.
Sistema, an oil to telecoms, retail and healthcare conglomerate, has thrown its hat in the ring by making a whopping Rbs23bn ($742m) bid for SG-Trans, a state-controlled liquefied petroleum gas railcar operator. Continue reading »
Mozambique’s are the gas fields that just keep giving. Eni, the Italian state-controlled energy group, said on Wednesday it had made a significant find of gas in the Mamba offshore exploration block – an extra 10tn cubic feet to its previous finds.
The discovery confirms Mozambique as one of the key areas for LNG in Africa and one of the most exciting prospects for the world’s major energy companies. Continue reading »
Repsol, the Spanish oil company whose majority stake in Argentina’s YPF will be expropriated by law this week, has taken some revenge, it seems – hitting Argentina where it will hurt as the southern hemisphere winter approaches by blocking a shipment of liquefied natural gas. Repsol had contracted 10 cargoes of LNG and if they are all scrapped, that will leave a big hole to fill. Continue reading »
Winter appears to have come all of a sudden in Argentina, and low temperatures generally mean one thing: a scramble for gas. The nationalisation of YPF could throw a further spanner in the works, since Repsol won key contracts this year to supply Argentina with liquefied natural gas during the winter. Those contract are now in doubt. Continue reading »