Subscribe free to our newsletters via your
. Energy News .




ENERGY TECH
Russia is facing strong competition from US shale gas expansion
by Kate Ryzhkova
Moscow (Voice of Russia) Sep 17, 2012


Shale gas has become a game changer for the whole sector globally, making its significance impossible to ignore. FT reported that only after the effect of the boom in the US natural gas extraction became clear, in the depression of prices globally and the increasing chances of the country becoming an exporter, did Russian authorities finally recognize the potential threat.

Russia's hegemony in the gas sector had flown under the radar until recently, as the country now enjoys the status of the world's largest exporter. The situation started to change over the last decade, as the US discovered a way to extract natural gas from trapped shale formations.

Despite the fact that the environmental impact of the process spurred heated debates, the country proceeded with shale gas extraction, making every effort to expand its output. As a result, what not long ago sounded highly improbable turned into a reality. In 2000 shale gas provided only 1% of total American natural gas output, by 2010 the figure jumped to 20%.

Experts at Gas Strategies, a London-based energy consultancy, outlined that while the expansion of American LNG production is important, what is pivotal is the revision of appraisals of US domestic gas resources. Chris Levell, a manager with the firm posited that, "estimates of the size of the US gas resource base have been radically revised in light of the growing importance of shale gas, which is making up some 33% of the total resource base of the country."

Shale gas became a game changer for the whole sector globally, making its significance impossible to ignore. FT reported that only after the effect of the boom in the US natural gas extraction became clear, in the depression of prices globally and the increasing chances of the country becoming an exporter, did Russian authorities finally recognize the potential threat.

Europe has always been the country's "safe haven" market for gas exports. A number of pipelines linking the two regions, coupled with long-term contracts between the parties have arguably created a false sense of security for Russia.

Currently, the country is trying to adapt to a swiftly changing business landscape. However, some experts including Andrey Konoplyanik, director at the Institute for Energy and Finance, argue that it has long way to go.

"Russia's Gazprom is really facing increasing competition in the European Union gas market, and I think it is not a temporary situation," Konoplyanik said by phone on Friday, concluding that, "in order to protect its market niche, Gazprom has to become more competitive and more adaptable; however, so far the company has been losing this struggle."

While at present, Russia continues to flounder to secure its position as a major gas supplier for the EU, the US concluded its first long-term contract with British Gas, one of the key players on the European gas market.

Under the agreement, the price is linked to Henry Hub spot prices, which dipped below $2 per million British thermal units or Btu (a measure of heating power) earlier this year.

Just for comparison, currently the average price of gas imported to the UK is $8-10 per million Btu, while Russian gas at the German border costs no less than $11-12 per million Btu.

Source: Voice of Russia

.


Related Links
Shale Gas News at Energy-Daily
Powering The World in the 21st Century at Energy-Daily.com






Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks
del.icio.usdel.icio.us DiggDigg RedditReddit GoogleGoogle








ENERGY TECH
Angola seeks to be Africa's top oil power
Luanda, Angola (UPI) Sep 14, 2012
Angola is driving to become Africa's leading oil producer and that's expected to gain momentum after its president since 1979, the autocratic onetime jungle fighter Jose Eduardo dos Santos, won another five years in office. Many in the former Portuguese colony on West Africa's Atlantic coast say the election, only the third since independence in 1975 and the first since the end of a sav ... read more


ENERGY TECH
EP passes sulfur fuel, efficiency bills

France's Hollande outlines 'green' energy policy

Cuba outage points to infrastructure flaws

Panda Power Funds Breaks Ground on 758 MW Temple, Texas Power Plant

ENERGY TECH
Iran says will hit Hormuz, US bases, Israel if attacked

Russia is facing strong competition from US shale gas expansion

Shell says to delay drilling for oil in Alaska

EU: Gazprom must play by rules

ENERGY TECH
Sufficient wind energy available to meet global demands without damaging climate

Report backs greater role for wind energy

Wind could meet many times world's total power demand by 2030

High-altitude winds have large potential as a source of clean energy

ENERGY TECH
DuPont Photovoltaic and Distributed Sun Collaborate on High Reliability Solar Modules

China 'deeply regrets' EU solar panel probe

EU hits Chinese solar companies with massive dumping probe

Constellation announces the completion of 16MW solar installation

ENERGY TECH
Japan says to phase out nuclear energy by 2040

Nuclear Proliferation Risks Of Laser Enrichment Require Fuller NRC Review

Canada wants Indian nuclear reactor sales

Germany ready to help Japan on nuclear exit

ENERGY TECH
EU confirms change in biofuel targets

France reconsiders plans to boost biofuel use

World Energy and Hydro Dynamics team up to promote SPR cavitation reactor technology

West Coast distributor expands biodiesel offering

ENERGY TECH
Tiangong Orbit Change Signals Likely Date for Shenzhou 10

China Focus: Timeline for China's space research revealed

China eyes next lunar landing as US scales back

China unveils ambitious space projects

ENERGY TECH
Researchers emphasize evaluation of tradeoffs in battling urban heat island

Next generation of advanced climate models needed

Climate change: Research questions 'worse drought' warnings

Ecosystems cope with stress more effectively the greater the biodiversity




The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement