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Shell defies US pressure and signs £5bn Iranian gas deal
Terry Macalister, Guardian
Shell has signed an important deal to help Iran develop a major gas field, ignoring growing pressure from George Bush to isolate the country for being part of what he alleges is an “axis of evil”.
The Anglo-Dutch group, which is struggling to bring more momentum to its business after being forced to hand over vital Russian reserves at Sakhalin island to the Kremlin, confirmed it had finally reached agreement on various aspects of its “Persian LNG” – liquefied natural gas – project centred on the South Pars gas field.
(29 Jan 2007)
It hasn’t taken long for US State Department to respond. Spokesman Sean McCormack said the investment agreement, if confirmed, would likely trigger a US investigation and possible sanctions under US law.
Chevron, Shell Delay LNG Projects, Sending Gas Higher
Angela Macdonald-Smith, Bloomberg
Chevron Corp. and Royal Dutch Shell Plc are delaying construction projects from Australia to Nigeria, threatening to drive natural gas prices higher for years to come.
None of the world’s biggest energy companies approved developments last year to increase production of liquefied natural gas, which helps heat homes and run power plants from Tokyo to Boston. The main reason is the cost to build LNG plants has tripled in six years, according to Bechtel Group Inc., the biggest U.S. contractor.
Natural gas prices are three times higher than during the 1990s and consumption of the fuel will outpace the 1.6 percent annual gain in energy demand for the next 25 years, according to the International Energy Agency. Gas is also becoming more popular because it emits 29 percent less carbon dioxide than oil and 45 percent less than coal burned in power stations.
“Costs are going up and they’re going up far faster than anybody expected,” said Andy Flower, a U.K.-based consultant to the LNG industry and a former BP Plc executive. He forecasts that the world LNG shortage will last until at least 2011.
Gas may become more important than oil in the next 50 years because crude supplies are running out faster, according to the Paris-based IEA. Global oil and natural gas reserves were about the same at the end of 2005, equal to 1.2 trillion barrels of crude, according to data compiled by BP. Oil reserves are being burned almost twice as quickly as gas. ..
Two of the newest and biggest LNG projects have been over budget and late. Shell’s Sakhalin-2 LNG in Russia has doubled in cost to more than $20 billion. Stavenger, Norway-based Statoil ASA’s Snohvit LNG plant will cost $9.5 billion, almost 50 percent more than first anticipated in 2002. ..
(17 Jan 2007)
Contributor Greg Jeffers writes: The author, not wishing to alarm her readers, speaks in terms of consequences 50 years out. Is the spirit of Woodward and Bernstein dead? 50 years? Way to go out on a limb, Angela!
Petronet LNG expects 50 per cent cost escalation
Staff, India Times
Kochi (India): Petronet LNG is expecting a 50 per cent cost escalation of its Kochi project as it gets ready to sign the LNG supply contract with Gorgon project in Australia.
The need for a deeper pile work because of unstable soil and rising price of nickel to be used inside the storage tanks will push up the project cost by Rs 1000 crore to Rs 3000 crore, Petronet CEO and MD P.Dasgupta told reporters here.
After concluding all commercial negotiations, Petronet is discussing the draft sales purchase agreement for supply of 2.5 million tones of LNG from Gorgon for 25 years. “We will have to conclude it by June 30,’’ Mr Dasgupta said. ..
Petronet is expecting to start construction by mid-year after awarding the engineering, procurement and construction (EPC) contract and shipping contract by March 31. The Gorgon gas will be available from 2011 while the Kochi project is expected to be completed by July 2010. Petronet will buy LNG from other sources to fill the temporary gap, according to Mr Dasgupta. ..
(29 Jan 2007)
Rumour/pay per viewYemen Confirms China LNG Talks
Energy Intelligence Group
State China National Offshore Oil Corp. is in talks to buy US Hunt Oil’s stake in Yemen LNG, well-placed Yemeni officials confirmed to International Oil Daily Monday.
(30 Jan 2007)