Oil, Gas and Uranium for Europe, but not from Russia, page 1

EU, Kazakhstan strengthen energy links
Published: Tuesday 5 December 2006

The European Commission and Kazakhstan have signed an agreement that lays the foundation for deeper energy co-operation. Caspian oil, gas and uranium are among the EU's chief objectives.

A Memorandum of Understanding (MoU) signed on Monday (4 December) sets the framework for deeper cooperation between the EU and Kazakhstan. It was completed by a co-operation agreement to develop nuclear trade.

"Kazakhstan holds approximately 20% of the world's known reserves of uranium, which makes it the third-largest producer in the world," the Commission stated.

"With these two documents, the Republic of Kazakhstan and the European Union have laid the foundations for constructive co-operation in the energy sector which will be extremely fruitful for both parties," explained Commission President José Manuel Barroso.

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And the Union is going to need that uranium! The world's first nuclear-fusion reactor will be up and running in France in 2015 and to prevent Europe from becoming too dependent on Russia it is a great development to strengthen relations with countries in the vicinity of the natural reserves rich Caspian Sea area.

Europe's main suppliers for natural gas and oil suppliers are Russia (25%) and Algeria. Russia tries to do everything to prevent Europe from accessing other oil and gas supplies by taking over foreign companies, constructing foreign pipelines, and blackmailing other countries with price increases. Don't listen to the big red boss? Then you'll just pay thrice the price for natural gas compared to your obedient neighbor.

"If you believe the prognoses, the need for gas will rise tremendously in Europe," Otto Musilek, the head of OMV's gas division, told DW-WORLD. "We've started the Nabucco project knowing that we need new sources and alternative transport routes to deal with this enormous need."

But the plan to use Central Asian reserves has irked Moscow, which currently forces these countries to deliver their gas to Russia in order to resell it to European customers.

"Russia has a massive interest to prevent the pipeline," said DIW's Kemfert.

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Hopefully, the French plant will be a success so Europe would be able to increase the level of nuclear power production.

Norway, the Netherlands, and the UK have large natural gas reserves, but those are expected to be exploited by the end of 2025, which is why it is also negotiating with Qatar to supply natural gas in liquid form. The first docking stations have already been built in Italy.

Experts and gas industry officials also see great potential in liquefying gas. During this process, the raw material gets chilled to minus 163 degrees Celsius (minus 261.4 degrees Fahrenheit) before it is loaded onto huge tanker ships. Until now, this procedure has been extremely expensive and, therefore, uneconomical.

But Astrid Zimmermann, a spokeswoman for German energy company Eon, said that costs for ships and liquefaction plants have been lowered tremendously.

"At the same time, energy prices have risen," she said. "That's why liquid gas is becoming another option next to pipeline gas."

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Besides, Russia is not really a country we could rely on, remember Ukraine? Russia just cut off supplies to Ukraine, and thus to Europe because Ukraine developed in a too western oriented way. Russia can't stand those countries and therefore blackmails them by cutting off oil and gas supplies.

Amusing comparison:

Moscow - Europe is to pay Russia's Gazprom 293 US dollars per 1,000 cubic metres of natural gas in 2007, a 14 per cent increase over current prices, the daily Vedomosti reported Monday.

The price would provide the Russian government-controlled monopoly with 46 billion US dollars in income from Europe, the paper reported, citing documents prepared for the gas giant's board of directors that it said it had obtained.

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and:

Belarus, the country governed by a brutal communist dictator:

Loyal Belarus pays just $47
Russia has long provided its former Soviet neighbors with cheap energy in return for political loyalty and economic preferences. The Baltic states of Latvia and Estonia - now EU and NATO members - pay $110 for the same amount of Russian gas. Russia's loyal ally, Belarus, pays just $47.

In late 2005, Gazprom said it charged its customers in Western Europe an average of $135 per 1,000 cubic meters, but expected that figure to rise to about $255 this year. Poland won't say what it pays, but media reports have said it pays between $200-$250, according to The Associated Press. Bulgaria now pays $180 per 1,000 cubic meters, but is expected to pay between $230-$260 in 2006.

Great development that the Union spends its money on finding alternative resources and nuclear development. Besides, the European automotive industry expects cars to running on hydrogen to be in production in 2015!