USA

Technical study for Alexandroupoli LNG unit by this summer

Posted on by admin

Technical studies for a floating LNG terminal being planned for Alexandroupoli, northeastern Greece, are expected to be completed by this coming summer.

The prospective project was described as one of pivotal importance for Europe’s energy security and US interests, Robin Dunnigan, Deputy Assistant Secretary for Energy Diplomacy at the US Department of State’s Bureau of Energy Resources, noted yesterday following talks with officials at Gastrade, a Copelouzos corporate group company interested in the LNG unit’s development, as well as Greece’s energy minister Giorgos Stathakis.

The official pointed out that the US’s transformation from natural gas importer to exporter has led to a revision of the country’s outlook on the southeast European region and projects such as the prospective Alexandroupoli facility.

Dunnigan pointed out that annual US LNG exports are expected to exceed 100 billion cubic meters over the next five to seven years, increasing the country’s global market share in the sector to around 20 percent.

This prospect has increased the importance of the Alexandroupoli LNG station for US gas trading companies as the facility is being regarded as a gateway for American shale gas into the Balkans and central Europe.

The US energy official also noted that the US government plans to offer support to American firms planning to invest in Greece’s energy market, a remark interpreted as an indirect reference to Cheniere, which has expressed an interest to export LNG and supply the wider Balkans via the prospective Alexandroupoli facility. To date, Cheniere has already completed sixteen American LNG shipments to Europe.

Work on the FEED (front-end engineering and design) technical study being conducted for the Alexandroupoli floating station began recently. Its expected completion by this coming summer will enable Gastrade to make a final investment decision by the end of 2017.

If all goes well, the Alexandroupoli facility, a floating Storage Regasification Unit (FSRU) with a 170,000 cubic meter capacity planned for a location 17.6 km southwest of the Alexandroupoli port, will begin operating at the end of 2019.

Classified as an EU Project of Common Interest (PCI), the facility is planned to be incorporated with the region’s TAP pipeline and Greek-Bulgarian IGB interconnection.

 

Trump’s stance could reshape Europe’s foreign and energy policies

Posted on by admin

The election of Donald Trump to the US presidency may bring about changes to Europe’s energy and foreign policies if the new American leader insists on pursuing a path leading to isolationism and warmer ties with Russia.

As for the Russian part of the equation, speculation of Trump’s close personal and business associations with the Kremlin has become widely known. The disclosure of Russia’s alleged intervention in the US elections, the objective being to push Trump to power, has stunned the political landscape worldwide.

If these developments are transformed into foreign policy then major shifts in balances of power can be expected in regions such as Eastern Europe, the Middle East and central Asia.

Trump’s ongoing disparagement of NATO is not an encouraging sign for countries of the former eastern bloc. They view Russia with hesitancy and need allies, Ukraine being an obvious example.

A change of energy market roles for Russia and Ukraine would severely impact Europe’s energy policy. For many years now, Ukraine’s extensive pipeline network has been used by Russia to transmit its natural gas to Europe. However, as a result of troubled relations between Moscow and Kiev, the Kremlin has sought strategic independence from Ukraine over the past decade or so. Russia has been promoting the development of new gas supply lines to Europe such as Nord Stream 1 and 2, South Stream and Turkish Stream, all of which bypass Ukraine.

Russian wants to establish itself as a gas supplier to Europe via a seamless network, which would enable the country to increase its supply and control both networks and the market.

The European Commission claims it wants reduce its Russian energy dependence, despite the fact that consumption has increased, as highlighted by market data for 2016.

Brussels essentially does not want Russia to develop new pipelines as it fears Europe’s influence on energy issues will diminish. Another European fear is that Ukraine will be completely abandoned to Russian intentions. Ukraine’s pipeline network is its most powerful bargaining tool opposite Russia. If Trump insists on a pro-Russia policy, prompting a US-Ukraine split, then Europe will be Ukraine’s only remaining ally.

 

 

 

 

 

Greece must back US in Europe’s energy battle, ambassador tells

Posted on by admin

Greece will need to pursue its energy policies in accordance with American regional priorities and interests or else be viewed as a rival force, the Barack Obama-nominated US ambassador to Greece Geoffrey R. Pyatt noted yesterday at a local industry event, the Athens Energy Forum. The US and Russia are currently maneuvering natural gas supply control in Europe.

Though expressing support for Greece’s aspiration to become a regional energy hub, as indicated by his firm backing for the development of projects such as the TAP and IGB pipelines, as well a floating LNG unit in Alexandroupoli, northeastern Greece, all of which will help boost non-Russian gas supply, including American, to Europe, Pyatt made clear the US’s opposition to the development of the ITGI pipeline, planned to transmit Russian natural gas to Europe via Greece and Italy.

The ITGI project is being discreetly supported by the Greek government, DEPA, the Public Gas Corporation, and Edison, along with Russia’s Gazprom.

Pyatt also reminded, in a less direct fashion, that the US possesses a number of alternatives to get its LNG to European markets. He made reference to a new LNG terminal in Lithuania, one of the gateways available to the US, along with Turkey – as highlighted by a recent LNG delivery to the country by US LNG trader Cheniere – and Poland, receiving strong US support for a major LNG terminal.

Greece will need American support to develop its LNG terminal plan in Alexandroupoli, part of the strategy that would help transform the country into a regional energy hub.

Not surprisingly, the US ambassador devoted a significant part of his speech at yesterday’s Athens conference to explaining why America believes Russia’s natural gas transmission plans for Europe should not be reinforced by third parties.

Pyatt made numerous references to the EU’s intention to end its heavy reliance on Russian natural gas, noting that this represents a golden opportunity for the US to ship in LNG tankers to the continent. Despite the high expectations, the results have been subdued so far.

Gazprom has already made a move to reserve TAP capacity as part of its natural gas transmission plans to Europe. This initiative has been met with cautious optimism, and, in some cases, approval by TAP consortium members. The Russian energy giant’s initiative has, as expected, provoked a negative US reaction.

 

 

 

Trump challenges OPEC in bid for US energy independence

Posted on by admin

Two opposing forces are currently impacting the global oil market but offsetting each other’s impact to maintain prices at slightly over 52 dollars per barrel.

On the one hand, an agreement between OPEC members to curb output is being successfully implemented as 1.5 million barrels are already being withdrawn on a daily basis. The agreement’s objective is to reduce production by 1.8 million barrels per day. If fully implemented, the agreement will lead to a global oil production reduction of around 2 percent. On the other hand, the just-inaugurated President Donald Trump’s energy policy promotes increased US shale oil output as a means of ending the US’s dependence on OPEC for energy.

Trump’s “An America First Energy Plan”, just published on the White House website, promises to support a shale oil and gas revolution, which, besides offering energy independence, would boost energy sector employment. According to the plan, the US, sitting on oil and gas reserves worth 50 trillion dollars, will utilize this potential.

Trump’s plan for US energy independence is widely regarded as being overambitious. US production will need to replace current imports amounting to three million barrels per day.

The new US president’s energy plans are not new. A previous Republican administration had sought to reduce US oil imports from the Middle East by 75 percent by 2025. OPEC reacted, crucial geopolitical balances were placed at risk, and the plan ultimately failed. A rift between USA and OPEC in the current era is made even more complicated by the need for a partnership to combat terrorism.

In recent weeks, US production has increased by 40,000 barrels per day. If US output continues rising, it will end up offsetting the market impact of OPEC’s policy to curb production. Prices will begin dropping again.

These contravening policies could lead to new war for greater oil market shares. If US output continues to increase, OPEC members could reconsider their decision to limit production and begin pumping out more, which would prompt price reductions.

Analysts forecast a stabilization of prices at a level of between 50 and 60 dollars as the likeliest scenario.

Russian energy minister Alexander Novak yesterday reiterated his support for Trump’s energy policy, noting that Moscow is satisfied by the Trump administration’s elevation of energy matters as a top priority. Novak expressed hope that the US and Russia will soon meet again at the negotiating table.

China taking CO2, RES lead as Trump’s US prepares to back coal industry

Posted on by admin

The Chinese government has decided to cancel plans concerning the construction of 104 new coal-fired power stations in 13 provinces, whose development would have provided an additional capacity of 120 GW. Placed within an international context, the decision is impressive. The total installed capacity of coal-fired units in the USA, preparing for a new administration led by the coal-friendly President-elect Donald Trump, amounts to 305 GW.

China’s objective, as announced by the government, is to spur renewable energy growth as a means of tackling the country’s pollution problem. Beijing intends to invest 365 billion dollars in RES development by 2020, which the Chinese government expects will create 13 million new jobs for the sector and provide an additional capacity of 130 GW through wind and solar farms. China has set itself the objective of generating 50 percent of the country’s electricity production through hydropower, RES and nuclear means, all free of CO2 emissions, within the next decade.

China’s decision to lessen its reliance on CO2-emitting electricity production possibly represents a pivotal point in the country’s energy and climate change history, while also being highly symbolic, as it comes just days ahead of the inauguration of Trump, who has repeatedly expressed strong support for fossil fuels, particularly coal. The Presiedent-elect has declared that he may choose to not honor the international climate change agreement reached in Paris just over a year ago. He also intends to nullify numerous RES-supporting initiatives taken by the outgoing President Barack Obama.

Low-priced US natural gas still not reaching Europe

Posted on by admin

Natural gas price levels have continued to remain at low price levels in the US market, subduing the export prospects of large LNG amounts via new terminals being developed on the country’s east coast.

American LNG output, based on shale reserves, is regarded as a significant alternative energy source in Europe, especially the EU’s member states in the east, seeking to end their dependence on Russian natural gas.

As previously reported by energypress, leading US exporter Cheniere, primarily active in LNG-related businesses, has expressed interest in the development of a floating LNG station in Alexandroupoli, northeast Greece, either as a supplier or project partner.

Forbes magazine has forecast US natural gas prices will range between 3-3.50 dollars per MMBtu in 2017, up compared to the level of 2.60 dollars in 2016.

In more recent times, international prices have risen as a result of freezing temperatures that have affected many regions in the Northern Hemisphere, increasing heating fuel demands.

Analysts believe American LNG exports could increase from the current level of 42 million cubic meters per day to levels of between 283-339 million cubic meters per day between 2016 and 2020 through increased shale gas development and flexible contracts.

Until now, the greatest proportion of LNG exports has headed to Latin America as energy shortages experienced by many countries in the region have forced them to import. A turn towards Asia is considered highly likely. Natural gas demand in this region is expected to grow. Price levels recently reached a two-year high. Most recently, they fell slightly to 9.50 dollars per MMBtu.

By comparison, European price levels remained subdued in 2016, registering 5.50 dollars per MMBtu in December. The colder weather experienced over the past month or so has temporarily increased demand and prompted extraordinary LNG imports from specific markets. Price levels for February deliveries reached 10.39 dollars per MMBtu in France and 10.31 dollars per MMBtu in Spain. Similar prices have been shaped in Italy, where increased gas imports are needed for the country to make it through the winter.

It was initially believed that Europe would serve as the main market for American gas exports as a result of the continent’s need to break its dependence on Russian supply and the energy security policy pursued by Brussels. However, market forces have had the upper hand.

Even so, latest data showed that two very recent LNG load dispatches from the US are headed for European shores. American LNG is being traded in a liberal fashion without long-term contract commitments between suppliers and clients, as is preferred by other gas producers.

Forecasts envisioning an increase in American LNG exports as a result of the country’s ongoing shale reserve development should make available considerable amounts towards the end of the decade, permitting European firms to order greater amounts.

 

 

Trump set to nullify Obama’s climate change policies, RES framework

Posted on by admin

The energy policies to be pursued by US President-elect Donald Trump, according to a memo leaked just days ago by the Center for Media and Democracy, a nonprofit liberal watchdog and advocacy organization, promise to press the reset button on President Barack Obama’s climate change policies, including his contribution to the Paris Agreement as well as RES legal framework.

Trump has already appointed a supporter of fossil fuels to head the country’s Environmental Proteection Agency.

The USA’s commitment to the Paris Agreement, adopted precisely one year ago, was described as “deeply problematic” in the leaked memo, signed by Thomas Pyle, Trump’s energy transition head.

The next US leader, according to the memo, also plans to nullify the Obama administration’s RES legal framework.

The findings of a study on the effects of greenhouse gas emissions will also be reexamined and possibly cancelled, according to the memo.

Europe taking precautionary measures to avoid cold winter

Posted on by admin

The European Commission is taking precautionary measures to avoid any natural gas supply issues this winter, expected to be particularly cold.

Last week, Maros Sefcovic, the European Commission vice president responsible for Energy Union, met in Moscow with Russia’s energy minister Alexander Novak. The two officials decided to hold a follow-up meeting, with Ukraine represented, to focus on natural gas and its transportation to Europe.

Sefcovic has stressed that Russia and EU depend on each other when it comes to energy matters. “The EU is a basic export destination for Russian fuels and payments are made on time with hard currency,” Sefcovic pointed out. “The EU wants to continue buying Russian natural gas in the future,” he added.

Just days ago, on November 24, the EU and Ukraine signed a ten-year memorandum of cooperation for a strategic energy alliance, which reinforces an agreement reached between the two sides in 2005.

Greece finds itself at the core of the wider region’s energy developments. Various scanarios being contemplated and discussed include Greek territory or activity by the country’s borders.

The Southern Corridor and LNG supply are high-priority items on the US agenda for the southeast European region. Studies have shown that LNG transportation will eventually overshadow gas pipelines, internationally, in terms of importance. The US is seeking the lion’s share of the LNG transportation market. US President-elect Donald Trump has promised to place emphasis on US exports.

The natural gas market was also a key matter during a recent meeting in Athens between Greek Prime Minister Alexis Tsipras and US President Barack Obama. Subjects covered by the two leaders included the TAP, IGB and Alexandroupoli LNG terminal, as well as deposits in the eastern Mediterranean.

US president Obama stresses need for Greek debt relief

Posted on by admin

US President Barack Obama, during a meeting in Athens today with Greek Prime Minister Alexis Tsipras, congratulated the Greek government and the Greek people for moving forward through a very challenging period.

“My hope is that given the growth we saw this year, we can build on that progress. The reforms have not been easy but have been necessary to boost the competitiveness of the economy… In my message to the rest of Europe I will continue to emphasize our view that austerity alone cannot deliver prosperity,” he said, stressing the need for debt relief.

“It is going to be important both with respect to debt relief and other accommodative strategies to help the Greek people during this period of adjustment,” Obama added.

On his part, Prime Minister Alexis Tsipras noted: “It is a great honor that you visit Greece during your final Europe tour, giving a special message to the world.”

Referring to the economic crisis, Tsipras said that Greece “stands strong and will continue, despite the difficulties over the last 5 years.”

The US President said the US hopes to work with Greece, Turkey and other interested parties to support and encourage a just and durable solution for the Cyprus issue and expressed his deep appreciation for the compassion shown by Greek people to the refugees.

He also voiced the US’s commitment to cooperate and assist Greece in implementing the programs that have reduced refugee inflows and emphasized the need to “assist these people who are in enormous need even as we try to resolve the issues that have led to the crisis.”

 

Trump adviser Papadopoulos touted as energy convoy successor

Posted on by admin

Last week’s US election victory by President-elect Donald Trump has brought to the fore the possible role to be played by Greek-American George Papadopoulos, one of Trump’s campaign advisers on energy policy.

The role of Papadopoulos, who joined Trump’s campaign after fellow Republican candidate Ben Carson dropped out of the party’s race last March, has been the subject of many recent media reports.

In the lead-up to the US elections, the Greek-American official visited Greece at least once for a series of meetings with officials on the energy sector.

Papadopoulos attended Thessaloniki’s inauguration ceremony for construction of the Trans Adriatic Pipeline (TAP) last May. During that stay, he also engaged in a number of meetings, including with foreign ministry officials, held to disccuss the TAP pipeline, a key US regional interest.

Judging by the views expressed by Papadopoulos while in Greece, little change is expected on America’s pipeline strategy for the southeast European region. The US has been pushing for greater diversification in natural gas supply, which would break Russia’s dominance. The TAP project, to run through northern Greece, is planned to primarily carry Azerbaijani natural gas to Europe.

The tenure of Amos Hochstein, the US Special Envoy and Coordinator for International Energy Affairs, expires this month. Certain pundits claim Papadopoulos could be named his successor. It remains unknown whether Hochstein, an expert in the region’s energy matters, will maintain a role as an adviser.

In an interview published by Greek daily Kathimerini, Papadopoulos placed emphasis on the future energy cooperation between Greece, Cyprus and Israel.