Make Today, Day 61 the day!
Posted on 03/02/2014 2:56:08 PM PST by Kaslin
Like many conflicts before it, the current battle brewing between Russia and Ukraine has a strong energy component.
Russia has a history of using its energy supplies as a control mechanism—such as the 2006 and 2009 gas wars when it cut natural gas supplies in the midst of winter and left many European nations, which rely on Russian natural gas that is shipped through Ukraine, without energy. The supply disruptions were due to “disputes over politics, price, and late payments,” says the Washington Post. Back in November, before the current conflict erupted, Reuters reported: “Ukraine has for years been a politically troubled buffer state between Russia and the European Union, and has used its status as a gas transit corridor to play Moscow off against Brussels.”
Russia supplies virtually all of Ukraine’s natural gas and Ukraine serves as a critical transit route for sending Russian natural gas via pipeline into Europe.
Aware of its reliance on Russia, and seeking energy independence, Ukraine has taken several steps to move away from the grip Moscow holds over its energy supplies—a move that has not gone unnoticed by Russia. In addition to reducing its use, Ukraine is seeking supplies from other sources and has signed deals to develop its own resources that are thought to be “significant” and “similar to those that unlocked a boom in U.S. energy production,” reports the Christian Science Monitor (CSM).
A 2011 announcement in LNGIndustry.comstates: “Ukraine is going to officially put out a tender for a company to perform a feasibility study for an LNG importation terminal on its Black Sea coastline.” It cites Vladyslav Kaskiv, the head of the state agency for national projects management (Ukrnatsproekt), who said: “construction on the terminal and regasification of liquefied gas will help diversify sources of energy carriers and strengthen the country’s energy security while improving the investment climate in Ukraine.”
In January 2013, Ukraine signed a $10 billion shale gas project with Royal Dutch Shell. In November, Chevron signed a similar deal. Regarding the deals, according to the Financial Times (FT), Ukraine’s president Viktor Yanukovich said: the agreements “will allow us by 2020 to become self-sufficient in gas, and, under an optimistic scenario, to become an exporter.” Before being ousted, the Yanukovich government was in negotiations with a group led by ExxonMobil, which wants to explore for oil and gas in a deep-water block in the Black Sea.
The November 2013 FT report suggested that the Shell and Chevron deals “could increase tensions with Russia.”
Ukraine—which pays some of the highest natural gas prices in Europe—asked Moscow, according to Reuters, to “ease terms it considers excessive and unaffordable.”
In November, weeks before Kiev was due to sign a free-trade agreement with the European Union (EU), Ukraine’s state energy company, Naftogaz, halted natural gas imports from Russia in a dispute over pricing. President Yanukovich then did an “about face” and backed away from the European integration deal in favor of repairing economic ties with Russia. Russian President Putin had been pressuring Yanukovich to, instead, join a Moscow-led economic bloc—The Eurasian Customs Union. Putin threatened trade measures against Ukraine if it signed the EU deal as planned on November 28-29 in Lithuania.
He who controls the food supply even has more power!
About a year ago, Ukraine was the victim of a scam. It signed a deal for an LNG facility with a person claiming to represent a company that could indeed build such a facility. The company subsequently claimed not to have any relationship with the man. Some thought it was a diversion by the Russians.
A better choice is to use the Turkish LNG facility near the Bosporus and use the current pipeline through which gas flows from Ukraine to Turkey.
If Obama had a lick of sense he’d immediately order the issuance of permits for the Cove Point and Gulf of Mexico LNG liquidification facilities. In one stroke of the pen he’d have Putin by the balls. Russia is dependent on oil and gas sales for 50% of its federal budget.
Replacing Russian natural gas with American natural gas would end Russian dreams of an empire.
Dang!
I wish I'd thought of this!
Matthew 10:28
And fear not them that kill the body, but are not able to kill the soul;
but rather fear the one who can destroy both body and soul in hell.
And send MY bill for propane THRU THE ROOF!
Ooops; I misread that and thought you advised EXPORTING all the gas.
Russia is sitting on even bigger energy reserves in eastern Siberia—reserves that may come online in the next 20 years. That’s why two companies the watch for are Gazprom (Russia’s primary natural gas producer) and Rosneft (Russia’s primary oil producer)—they may soon be as influential as Saudi Aramco and international energy conglomerates like Chevron, Exxon Mobil and Royal Dutch Shell.
“Replacing Russian natural gas with American natural gas would end Russian dreams of an empire.”
Yes, America could become the largest energy exporter. It would solve our worthless currency problem, our jobs issues and a host of other problems. But, the last thing liberals want is a more powerful less troubled America. So, they’ve hampered exploration, pipelines and refineries for 40 years.
Propane is one of the wet gases that comes from natural gas wells. The more drilling and fracking the more propane produced. LNG is liquified natural gas. Most of the wet gases like propane, butanes, pentanes and ethane are stripped out of the natural gas and sold separately.
So the production of more natural gas means more propane is produced too. That means the price of propane should go down.
And he who controls the water has still more power! (then comes air, then space)
What Ukraine should have done years ago was develop nuclear power.
No diesel, no food.
I am not sure if they would have been able to?
Looks like the Amish ARE going to win!
He who controls the biggest guns / most guns has the power. Always has, always will.
You can’t shoot guns with no food and water because you will starve along with your army.
“Propane is one of the wet gases that comes from natural gas wells. The more drilling and fracking the more propane produced. LNG is liquified natural gas. Most of the wet gases like propane, butanes, pentanes and ethane are stripped out of the natural gas and sold separately.
So the production of more natural gas means more propane is produced too. That means the price of propane should go down.”
Sounds great, but the price of my propane has gone from less than $2.00 to $3.50 in less than a year, without big time exports of natural gas.
Let’s keep our own energy resources here.
That’s one way to look at it. However, we’re not going to see a surplus of propane unless we encourage additional natural gas production to meet increased demand. That means propane pricing will remain sensitive to unusual sources of demand such as occurred this past year because of agricultural needs.
Exporting natural gas will not only cut into Russia’s income, it will also cut the cash flow to Middle Eastern countries like Iran. Less money there means less money rattling around to finance terrorism. Kicking both Russia and Iran, etc. in the nuts certainly is appealing. But don’t tell Obama. He wouldn’t want to screw up his buddies’ game plan for the world meaning death and deprivation for Americans.
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