Daily Archives: December 17, 2010

Kiran Stacey

A hat tip to Nick Grealy of No Hot Air for spotting this one. On Wednesday, the energy minister Greg Barker gave an intriguing glimpse of the UK attitude towards fracking, the gas extraction method that has caused so much controversy in the US. And it’s good news for the gas companies.

Here is the full exchange:

Mr Bain: To ask the Secretary of State for Energy and Climate Change what his policy is on the use of hydraulic fracturing by the oil and gas industry; and what discussions he has had with his EU counterparts on regulation of the use of hydraulic fracturing.

Gregory Barker: Hydraulic fracturing has long been used to increase the productivity of oil and gas fields and, more recently, of shale gas reservoirs, where the rock has low natural permeability. The Department has no objection to the use of this technique so long as all of the relevant environmental and planning assessments have been carried out and permissions granted. I have had no discussions with my EU counterparts on the regulation of the use of hydraulic fracturing.

Kiran Stacey

Two days ago, before Chris Huhne announced his package of measures to shake up the UK electricty market, a group of energy industry insiders and experts told Energy Source what they wanted to see from the reforms. Now that we know the details, and people have had time to figure out what they mean, the question remains, did they get what they wanted?

Kiran Stacey

Peter Voser

Image by Shell

In this week’s readers’ Q&A session, Peter Voser, the chief executive of Shell, answers your questions.

In the second of two posts, he discusses the future of natural gas, the controversial process of “fracking” and why biofuels are the answer to powering transport.

Next in the hotseat is Chris Huhne, the UK energy secretary, who will be answering your questions on electricity market reform next Thursday, December 23rd. Send in your questions for consideration by the end of today – Friday, December 17th – to energysource@ft.com.

But for now, over to Peter:

Kiran Stacey

Peter Voser

Image by Shell

In this week’s readers’ Q&A session, Peter Voser, the chief executive of Shell, answers your questions.

In the first of two posts, he addresses when and how the next oil price shock might happen, the future of the North Sea and why Shell left the Falklands.

In the second post, published above, he discusses the future of natural gas, the controversial process of “fracking” and why biofuels are the answer to powering transport.

Next in the hotseat is Chris Huhne, the UK energy secretary, who will be answering your questions on electricity market reform next Thursday, December 23rd. Send in your questions for consideration by the end of today – Friday, December 17th – to energysource@ft.com.

But for now, over to Peter:

Kiran Stacey

Macondo explosionThe BP oil spill has harmed the reputation of the entire oil industry, the chief executive of Shell, BP’s closest rival, has said.

Answering Energy Source readers’ questions, Peter Voser said:

Undeniably, the Macondo incident has greatly harmed the oil industry’s reputation. Our ablity to drill in deep water has been questioned, and that’s a serious matter.

FT Energy Source

- US doubles estimates for gas reserves – FT

- The energy future ain’t what it used to be – NY Times Green blog

- Cost of BP spill lies with US courts – FT

- ‘Gross negligence’ is the real fear for BP – FT Lex

- US sues BP: What the analysts say – The Telegraph

- Total to pay $1.74bn for stakes in Suncor projects in Canada – Bloomberg

- US delays vote on commodity trade – FT

- US pushes solar power in six western states – Reuters

- Upton restructures House energy committee – Argus

- Campaigners hit at nuclear power ‘subsidy’ – FT

- Huhne insists energy plan takes ‘market approach’ – FT

- Electricity market reform: two cheers – Damian Carrington, The Guardian

- Nuclear option posed to test coalition further – FT

- California regulators approve efficiency payments for utilities – WSJ (£)

- Poland to hold talks with EDF over Enea sale – FT

Ed Crooks

The civil suit against BP brought by the US government on Wednesday had been inevitable since we first found out that thousands of barrels of oil were spilling into the Gulf of Mexico. The timing of Wednesday’s announcement, mandated by the judge at the New Orleans court where the trial will be held, was the only surprise. It perhaps did not send the best message about the business-friendly nature of the administration, on a day when President Obama was courting many of America’s top CEOs.

The share price reaction was modest, reflecting the fact that while the headlines are terrible for sentiment, investors always knew this day would come. The news looks bad for BP, but shareholders can still hope for better, as the Lex column points out.

Nevertheless, the Department of Justice’s action is a salutary reminder that, eight months after the fatal accident on the Deepwater Horizon, and three months after the ill-fated Macondo well was sealed for good, BP is still not even close to finding out exactly how much the disaster will cost.

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