EAGC2011: Europe's gas industry struggles to secure supply, rational regulation

Regulatory and supply uncertainties continue to plague Europe’s natural gas industry, as made clear by presentations and discussion Nov. 15 at the opening of the annual European Autumn Gas Conference in Paris.

The world’s largest market for imported natural gas has seen its security of LNG supply threatened this year by the effects of Japan’s Fukushima nuclear reactor catastrophe in March. At the same time, Europe continues to struggle to establish a dependable network of pipeline-supplied natural gas.

Overriding these logistical issues is an uncertainty over the nature and predictability of governmental regulations, mainly in terms of the region’s efforts to reduce carbon dioxide emissions. That uncertainty is only aggravated by the European Union’s current fixation on solving its sovereign debt problems.

After Japan

Among several speakers, many referred to a “post-Fukushima world,” in which Japan—already the world’s largest LNG importer—soaks up yet more LNG available from newly commissioned projects.

Europe’s nuclear power industry has been effectively derailed, as such countries as France and Germany phase out nuclear power and turn towards renewables and, reluctantly, natural gas. In this context, Europe’s natural gas industry is anxious to solidify its gas supply from all available sources.

Earlier this year, it saw the start-up of Gate LNG in the Netherlands (OGJ Online, Sept. 23, 2011), with a number of new terminals set to open in the next 18-24 months.

Acknowledging the maturation of the global LNG industry, Jean-Marie Dauger, executive vice-president for global gas and LNG, said LNG is no longer a “niche supply” source.

Pipeline supply of gas was addressed by Alasdair Cook, vice-president of BP PLC’s $20 billion Shah Deniz II development offshore the Caspian Sea. He reported that first gas will flow from the project in 2017 with 16 billion cu m/year of gas and 100,000 b/d of oil.

The pipelines to bring the gas across Azerbaijan and Georgia and initially via Turkey’s Botas existing pipeline into southern and southeastern Europe will signal the opening of Europe’s long-awaited Southern Corridor.

All speakers agreed, however, that unconventional gas, especially from shale, will not play much of a role in supplying the region if any at all. France, one noted, has banned hydraulic fracturing.

Several speakers noted uncertainties created by the regulatory environment, especially the European Union’s commitment to “decarbonization” of energy supply. Clare Spottswoode of the UK’s Independent Commission on Banking noted governments’ historical reluctance to allow markets to work.

Han-Peter Floren, a member of E.On Rhurgas’s management board, pointed out that gas supply in the medium term appeared ample but, because of regulatory uncertainties, uncertain in the long term.

In this context, many speakers said, development of transportation infrastructure is vital, yet financing remains scare and expensive. Complicating the future is the worsening economic crisis in Europe that undermines energy demand in traditional growth markets. For private investors, the climate is discouraging.

Contact Warren R. True at warrent@ogjonline.com.

Related Articles

KMI to buy Shell’s stake in Elba LNG project for $630 million

07/16/2015 Kinder Morgan Inc., Houston, has reached a deal with Royal Dutch Shell PLC to purchase 100% of Shell’s equity interest in Elba Liquefaction Co. LLC...

Genesis to buy Enterprise offshore pipelines

07/16/2015 Genesis Energy LP has agreed to buy the Gulf of Mexico pipelines and services business of Enterprise Products Partners LP for $1.5 billion cash.

Mexican round nets two successful bids

07/16/2015 Two of 14 shallow-water blocks received successful bids on July 15 in Mexico’s historic Round One offering of exploration and production rights (OG...

CAPP: Canada needs global LNG markets for gas production growth

07/16/2015 Canada needs to connect to global LNG markets to avoid a decade of decline in natural gas production, according to the Canadian Association of Petr...

MARKET WATCH: Front-month crude oil price drops to lowest settlement since April

07/16/2015 Light, sweet crude oil prices dropped more than $1/bbl on the New York and London markets July 15, dipping to their lowest settlement since early A...

KMI brings second Texas condensate splitter online

07/15/2015 Kinder Morgan Inc., Houston, has commissioned the second of two splitters at the company’s new petroleum condensate processing facility located nea...

Michigan DEQ report urges ban of heavy oils in Mackinac Straits pipeline

07/15/2015 Michigan’s Department of Environmental Quality’s Petroleum Pipeline Task Force issued a report that recommended that heavy crude and oil sands be k...

PHMSA orders Plains All American to keep Illinois pipeline shut down

07/15/2015 The US Pipeline and Hazardous Materials Safety Administration issued a corrective action order directing Plains All American Pipeline LP to keep a ...

Advocates urge US to end its crude export ban in Iran agreement’s wake

07/15/2015 Advocates called for removing the US ban on exports of domestically produced crude oil in the wake of the July 14 international nuclear weapons agr...
White Papers

UAS Integration for Infrastructure: More than Just Flying

Oil and gas companies recognize the benefits that the use of drones or unmanned aerial systems (UAS) c...

Solutions to Financial Distress Resulting from a Weak Oil and Gas Price Environment

The oil and gas industry is in the midst of a prolonged worldwide downturn in commodity prices. While ...
Sponsored by

2015 Global Engineering Information Management Solutions Competitive Strategy Innovation and Leadership Award

The Frost & Sullivan Best Practices Awards recognise companies in a variety of regional and global...
Sponsored by

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by
Available Webcasts


Operating a Sustainable Oil & Gas Supply Chain in North America

When Wed, Oct 7, 2015

Short lead times and unpredictable conditions in the Oil & Gas industry can create costly challenges in supply chains. By implementing a LEAN culture of continuous improvement you can eliminate waste, increase productivity and gain end-to-end visibility leading to a sustainable and well-oiled supply chain.

Please join us for this webcast sponsored by Ryder System, Inc.

register:WEBCAST


The Resilient Oilfield in the Internet of Things World

When Tue, Sep 22, 2015

As we hear about the hype surrounding the Internet of Things, the oil and gas industry is questioning what is different than what is already being done. What is new?  Using sensors and connecting devices is nothing new to our mode of business and in many ways the industry exemplifies many principles of an industrial internet of things. How does the Internet of Things impact the oil and gas industry?

Prolific instrumentation and automation digitized the industry and has changed the approach to business models calling for a systems led approach.  Resilient Systems have the ability to adapt to changing circumstances while maintaining their central purpose.  A resilient system, such as Maximo, allows an asset intensive organization to leverage connected devices by merging real-time asset information with other critical asset information and using that information to create a more agile organization.  

Join this webcast, sponsored by IBM, to learn how about Internet of Things capabilities and resilient systems are impacting the landscape of the oil and gas industry.

register:WEBCAST



On Demand

Taking the Headache out of Fuel License and Exemption Certificates: How to Ensure Compliance

Tue, Aug 25, 2015

This webinar, brought to you by Avalara, will detail the challenges of tax document management, as well as recommend solutions for fuel suppliers. You will learn:

-    Why it’s critical to track business partner licenses and exemption documents
-    The four key business challenges of ensuring tax compliance through document management
-    Best practice business processes to minimize exposure to tax errors

register:WEBCAST


Driving Growth and Efficiency with Deep Insights into Operational Data

Wed, Aug 19, 2015

Capitalizing on today’s momentum in Oil & Gas requires operational excellence based on a clear view of what your business data is telling you. Which is why nearly half* of oil and gas companies have deployed SAP HANA or have it on their roadmap.

Join SAP and Red Hat to learn more about using data to drive process improvements and identify new opportunities with the SAP HANA platform running on Red Hat Enterprise Linux. This webinar will also show how your choice of infrastructure impacts the performance of core business applications and your ability to achieve data-driven insights quickly and reliably.

*48% use SAP, http://go.sap.com/solution/industry/oil-gas.html

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected