News & Current Affairs

January 6, 2009

Europe’s reliance on Russian gas

Europe’s reliance on Russian gas

A gas storage and transit point on the main gas pipeline from Russia in the village of Boyarka near the capital Kiev, Ukraine

Turned-off taps have caused gas shortages in Europe

The latest developments in the dispute over the price Ukraine pays Russia for its gas has yet again affected deliveries to other countries.

Several countries in Europe have reported a sharp decline or even complete cessation of gas supplies from Russia via pipelines through Ukraine.

This has reinforced unease in Europe about the important role that Russia has a supplier of gas.

A quarter of the gas used in the European Union (EU) comes from Russia.

And that share will rise.

Increasingly dominant

Europe’s need for gas is likely to increase.

Europe’s gas pipeline network

Economic growth, when it resumes after the current recession, will mean more demand for electricity.

Gas accounts for about a fifth of the EU’s electricity and the share is likely to grow, partly because gas produces less by way of greenhouse gas emissions than coal or oil.

The EU does have other suppliers, including Norway and Algeria by pipeline, and Qatar and Algeria, again, by ship.

But Russia, with the world’s largest gas reserves and an extensive network of pipelines to Europe, is likely to be increasingly dominant.

Soviet legacy

The EU, unless it drastically changes its energy strategy, will need Russia.

EU GAS IMPORTS FROM RUSSIA
100% dependent on Russia: Latvia, Slovakia, Finland, Estonia
More than 80% dependent: Bulgaria, Lithuania, Czech Republic
More than 60% dependent: Greece, Austria, Hungary
Source: European Council on Foreign Relations, 2006 figures

But Russia in turn needs Europe to buy its gas, and also its oil.

So it is not in Russia’s interest for Europe to become more wary of using gas as an energy source.

So far the disturbances to EU supplies have been a side effect of the recurrent dispute between Russia and Ukraine, with both sides blaming the other for the reduced supplies to the west.

The quarrels are a legacy of the end of the Soviet Union.

Ukraine has been receiving relatively cheap gas.

Russia’s Gazprom wants to charge more, and the negotiations are complicated further by questions about what fees Ukraine should receive for gas crossing its territory.

Some European countries are protected with substantial stocks to cover any supply disruptions for many weeks, although some, such as Bulgaria have very little cover.

The disruptions also reinforce the attractions of developing new pipelines that avoid potential problem areas.


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December 25, 2008

Gazprom to control Serbia’s oil

Gazprom to control Serbia’s oil

NIS archive)

Serbia is being offered a secure gas supply in return for its oil monopoly

Russia and Serbia have signed a controversial energy deal that will hand Russian gas giant Gazprom control of NIS, Serbia’s oil monopoly.

Under the deal, Gazprom is to build a gas pipeline through Serbia and an underground gas storage facility there.

Russia’s President Dmitry Medvedev and his Serbian counterpart Boris Tadic signed the agreement in Moscow.

The plan is for Serbia to host part of a new pipeline called South Stream, to deliver Russian gas to southern Europe.

Gazprom is taking a 51% stake in NIS for 400m euros (£380m; $560m), officials say.

Diplomatic tensions

Both countries signed an energy co-operation agreement in January, but the details have only just been finalised. Belgrade had delayed signing because a small party in Serbia’s ruling coalition had argued that the terms on offer to Gazprom were too generous.

Critics say Russia’s pledges to build South Stream by 2015 are not firm enough, given the current economic downturn.

South Stream is designed to take Russian gas under the Black Sea to Bulgaria and then to Serbia for transit towards the lucrative markets of southern Europe.

Washington and the European Union are backing a rival pipeline project called Nabucco, to bring gas from Central Asia, which would bypass Russia.

Correspondents say the planned pipeline could undermine the European efforts, which aim to reduce European dependency on Russian gas.

Serbia’s energy diplomacy is complicated by the fact that Nabucco has EU backing – yet Serbia wants to join the EU.

Political tensions over Kosovo are also a complicating factor, with the EU supporting Kosovo’s independence, while Belgrade and Moscow insist the territory remains part of Serbia.

Graphic showing Nabucco and South Stream pipeline routes

August 30, 2008

Energy-hungry Europe warms to Norway

Energy-hungry Europe warms to Norway

Amid frantic newspaper headlines about the possibility of a new Cold War, more and more governments around Europe are talking about their need for “energy security”.

What most of them actually mean is that they are not sure whether or not to trust the Russians.

A gas platform off the coast of Norway

Norway remains one of only two major fossil fuel exporters in Europe

There are only two big exporters of fossil fuels in Europe: Russia and Norway, so the choice – for countries without energy reserves of their own or fast depleting them – is limited.

And, undiplomatic as it is to admit it, the Norwegians stand to do very well out of the current political situation.

Officially, a healthy and productive competition exists between the two countries who share a border well above the Arctic Circle.

“We are also partners,” says Norway’s Prime Minister, Jens Stoltenberg, “because both Russia and Norway have an interest in the development of the European oil and gas market.

“And we welcome them into the market, because the market will be bigger if there are several suppliers.”

Mr Stoltenberg was speaking at the opening of an international conference about offshore energy in Stavanger, southern Norway.

Transparency

And, alongside the reassurances to his Russian neighbours, he did hint at his country’s trump card, when asked why the rest of Europe should take Norway as its energy supplier of choice.

Norway's Prime Minister Jens Stoltenberg

Norway offers a reliable energy supply and a stable democracy

“We are a reliable supplier. And we have proved that over many years. And we have a very transparent, open energy sector.”

The head of the conference, ONS Director Kjell Ursin-Smith, was prepared to go even further.

“The situation is very interesting for Norway, of course. We are looked upon as a stable nation, whereas Russia still has a tainted reputation in that respect. So I think we will try to prove that we are a stable producer of oil and gas for Europe.”

The proof of the UK’s commitment to Norway as a gas provider of the future is a massive new pipeline – the biggest engineering project of its kind in the world – known as Ormen Lange.

The pipeline, whose name means “giant serpent” in old Norse will stretch from the Norwegian North Sea fields to Easington on the East Yorkshire coast.

Further afield

Some 745 miles of steel tubing have been painstaking laid up and down the canyons of the seabed, designed to deliver about 20% of the UK’s domestic gas needs for the next 50 years. It came on stream late last year.

The Ukraine issue sent a shiver down the European energy spine and Georgia is a recent episode which will focus a lot of minds.
Malcolm Wicks, UK energy minister

The days when Britain could rely on its own reserves to be self-sufficient in oil and gas are long gone – with a current annual depletion rate of about 8% a year – so there is no choice but to look abroad.

Britain has always made a virtue of its lack of political interference in the energy market, preferring to make deciding on a supplier a matter of pure economics and stress the need for “diversity of supply”.

But things might be changing.

“We’re aware of what’s going on now”, says the UK Energy Minister, Malcolm Wicks.

He still stresses the need to source from more than one country, more than one route.

High stakes

But, he adds, referring to the incident in 2006 when Russia turned off gas supplies to its neighbor in order to force higher prices: “The Ukraine issue sent a shiver down the European energy spine and Georgia is a recent episode which will focus a lot of minds.

Map

“I think we have to be – how can I put it? – streetwise, when it comes to issues around energy security. Norway is a great partner to have. It’s a very sophisticated democracy with a great record when it comes to human rights. So the new pipeline is a good piece of democratic politics.”

The proportion of its energy western Europe has to import is likely to rise to about 70% in the coming decades, so the market is guaranteed and the stakes are high.

It remains to be seen whether the big two suppliers – Norway and Russia – will clash or co-operate when it comes to developing what is a potential El Dorado of the North – vast swathes of Arctic territory, largely in the Barents Sea, which new technology is opening up to oil and gas exploitation for the first time.

The disputes have already begun as to who owns what territory. Vast amounts of money are to be made.

Norway has known great wealth for nearly 40 years now, mostly thanks to its fossil fuel resources.

Russia, with an average per capita income still about a tenth the size of that of its tiny Scandinavian neighbor, has not.

And in these days of ‘new’ Russia rediscovering its confidence, reasserting its power in the world, observers of geo-politics can almost certainly expect fireworks.

August 23, 2008

Black hole star mystery ‘solved’

Black hole star mystery ‘solved’

Computer simulation of a molecular cloud falling into a black hole (Science/AAAS)

The researchers modelled how molecular clouds are sucked into black holes

Astronomers have shed light on how stars can form around a massive black hole, defying conventional wisdom.

Scientists have long wondered how stars develop in such extreme conditions.

Molecular clouds – the normal birth places of stars – would be ripped apart by the immense gravity, a team explains in Science magazine.

But the researchers say stars can form from elliptical discs – the relics of giant gas clouds torn apart by encounters with black holes.

They made the discovery after developing computer simulations of giant gas clouds being sucked into black holes like water spiralling down a plughole.

“These simulations show that young stars can form in the neighbourhood of supermassive black holes as long as there is a reasonable supply of massive clouds of gas from further out in the galaxy,” said co-author Ian Bonnell from St Andrews University, UK.

Ripped apart

Their findings are in accordance with actual observations in our Milky Way galaxy that indicate the presence of a massive black hole, surrounded by huge stars with eccentric orbits.

The simulations, performed on a supercomputer – and taking over a year of computing time – followed the evolution of two separate giant gas clouds up to 100,000 times the mass of the Sun, as they fell towards the supermassive black hole.

The simulations show how the clouds are pulled apart by the immense gravitational pull of the black hole.

The disrupted clouds form into spiral patterns as they orbit the black hole; the spiral patterns remove motion energy from gas that passes close to the black hole and transfers it to gas that passes further out.

This allows part of the cloud to be captured by the black hole while the rest escapes.

In these conditions, only high mass stars are able to form and these stars inherit the eccentric orbits from the elliptical disc.

These results match the two primary properties of the young stars in the center of our galaxy: their high mass and their eccentric orbits around the supermassive black hole.

“That the stars currently present around the galaxy’s supermassive black hole have relatively short lifetimes of [about] 10 million years, which suggests that this process is likely to be repetitive,” Professor Bonnell explained.

“Such a steady supply of stars into the vicinity of the black hole, and a diet of gas directly accreted by the black hole, may help us understand the origin of supermassive black holes in our and other galaxies in the Universe.”

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