Understanding the geopolitics of energy

WEG Update

7th December 2007

Dear Reader,

This is the Windsor Energy Group’s latest update on major developments involving the global energy market.  The newsletter includes details on the new Brazilian oilfield find, developments on the Kashagan cash compensation and news of Finland’s Neste Oil to build the world’s largest bio-diesel plant in Singapore. We are particularly pleased to have comments from Professor Tatsuo Masuda who was a guest presenter at the recent OPEC meeting in Riyadh. 

If you would like to learn more about this newsletter or forthcoming events, or perhaps would like to suggest an event or article for inclusion in the next edition, please do not hesitate to contact us.

Kind Regards,

Toby Osborne,

Editor

MEC International

Granville House

132 Sloane Street

London - SW1X9AX

Tel: 020 75914816

Fax: 020 75914801

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Commentary

Professor Tatsuo Masuda’s comments on the OPEC Summit Ministerial Symposium November 15-16th 2007

“I came to Riyadh to speak at the OPEC Summit Ministerial Symposium on 15-16 November. My role was to give a scene-setting presentation at the session, "OPEC and the Global Economy". The Summit started in the evening of

17 November, the opening ceremony of which, we were invited to observe.

President Chavez warned that oil price will hit $200/b if Iran were attacked. As this was from his mouth, no one seemed to have been surprised with this remark. King Abdullah, the host, stayed cool stressing that oil should not be the sources of conflict and expressed his readiness to contribute $300m to establish a fund to support researches to cope with climate change. This was a good contrast between Venezuela and the kingdom.

The summit declaration issued on 18 November did not show much of political colour. It stressed the need to fight against climate change and need for sustainable development.  The three themes of the declaration was something like that of an IEA Ministerial:

-Stability of global energy markets

-Energy for sustainable development

-Energy and environment

Very interestingly, in their six-page declaration, they used "technology (technological)" 13 times, and "innovation" 3 times.

These example may suggest that OPEC is trying hard to find a new comfortable seat in the global community which may well fit with the current new context. Despite its hard look under current higher oil price environment, OPEC is thinking and will be acting differently from what they used to be.  This is my observation on the spot in Riyadh.”

Tatsuo Masuda is a professor at Tokyo Institute of Technology responsible for the Science of Institutional Management of Technology (SIMOT) and the Graduate School of Nagoya University of Commerce and Business. He was Vice President of Japan National Oil Corporation (JNOC) from 2002 till 2005 at its final phase of dissolution. Prior to JNOC, he headed the Asia Pacific Energy Research Center (APERC). He served as the Director of the Office of Oil Markets and Emergency Preparedness at the International Energy Agency (IEA) in Paris from 1996 to 2001.

Main Articles

Finland’s Neste Oil to build largest bio-diesel plant in Singapore

A Finnish firm plans to build the world’s largest bio-diesel plant in Singapore to convert palm oil into fuel for cars, trucks and other vehicles. The cost for Neste Oil will amount to 550 million euros (814 million US dollars) and create 100 jobs, the firm said Friday.

Earthtimes 1st December 2007

Chief scientist says atomic power and GM crops are the future

Gordon Brown should approve a new generation of nuclear power stations immediately and give active government backing to genetically modified crops, the departing chief scientist will say today.

Timesonline 27th November 2007

Brazil ponders OPEC membership on find

Brazil would consider joining OPEC based on the size of the newly discovered Tupi oil field off its eastern shores, the country’s ambassador to Saudi Arabia said Friday.

BusinessWeek November 16 2007

Astana lays down Kashagan terms

Kazakhstan will demand either cash compensation or a bigger state stake in the AgipKCO consortium developing Kashagan, but Eni will stay in place as the field’s operator, Kazakh President Nursultan Nazarbayev said this morning.

Upstream 7th December 2007

China and India get first IEA invite

For the first time ever, the 27 member countries of the International Energy Agency (IEA) invited high-level Chinese and Indian delegations to participate in "Committee Week."

EnergyCurrent 6th December 2007

House passes a sweeping energy bill

The House on Thursday approved the biggest increase in vehicle fuel-economy standards since gasoline cost less than a dollar a gallon, in a sweeping energy bill that is headed for a showdown in the Senate and a possible veto from President Bush

LosAngelesTimes 7th December 2007

Oil price above $90 on Iran fears

Oil prices are back above $90, as the US government seeks to sustain pressure on Iran over its nuclear plans.

BBC 7th December 2007

OPEC ministers say no need for output rise

The Organization of the Petroleum Exporting Countries (OPEC) sees no reason for an output increase, the group’s member countries said on Wednesday, dashing consumers’ hopes for a rise to curb spiralling prices.

KhaleejTimes 5th December 2007

Norway and France in CCS collaboration

As a result of an expert seminar, Norwegian and French researchers will now cooperate more closely on developing solutions for the capture and storage of carbon dioxide (CO2).  The seminar was held in Alstom Norway’s office premises in Oslo and was organised by the French embassy in Norway in cooperation with Alstom, Det Norske Veritas (DNV), the Research Council of Norway, the French-Norwegian Foundation (FNS) and Total, with support from StatoilHydro and Gaz de France (GdF).

EnergyCurrent 4th December 2007

ENI seals Burren Energy takeover

Italian energy giant ENI has agreed to buy UK-based oil producer Burren Energy for £1.736bn ($3.58bn).

BBC 30th November 2007

Walker’s World: EU-China power play

With the United States still dragging its heels over climate change, the European Union and China should cooperate to become the engine of global low-carbon transformation, says a new report backed by the British Foreign Office.

Earthtimes 28th November 2007

French seal $12bn Chinese nuclear deal

President Sarkozy helped to clinch the world’s largest commercial nuclear power contract yesterday, winning an agreement to sell French-designed reactors and atomic fuel worth nearly $12 billion to China.

Timesonline 27th November 2007

China Deal Gives Lift to Revival of Fission

Areva, the French nuclear power giant, signed the largest deal in the industry’s history Monday, with China’s leading nuclear power company.

NewYorkTimes 27th November 2007

Naimi keeps mum over Opec’s next move

Saudi Oil Minister Ali al-Naimi said today the world’s top oil exporter had raised output to 9 million barrels per day in line with Opec’s 1 November agreement, but offered no clues about the group’s next meeting.

Upstream 27th November 2007

Countdown to lift-off

HARDLY a week goes by without a new reason to be gloomy about the dollar. The latest scare is that members of the oil-rich Gulf Co-operation Council (GCC) might loosen their links to the greenback, depriving the foreign-exchange markets of a reliable buyer of the troubled currency.

Economist 22nd November 2007

Saudi Arabia says gas pipeline fire killed 40

The final death toll from a gas pipeline fire in Saudi Arabia on Sunday was 40, Saudi Aramco said on Tuesday.

Reuters 20th November 2007

Upcoming Events/Publications

TUROGE 2008

The 7th Turkish International Oil & Gas Showcase (TUROGE 2008), will be held on 18-20 March 2008 at the Sheraton Convention Center , in Ankara.
Since 2000, TUROGE has been reflecting growing interest in Turkey Oil & Gas sector, Turkey strategic location and importance as regional Oil & Gas transportation hub between Central Asia, the Middle East and Europe.
As on previous years TUROGE 2008 is officially supported by The Ministry of Energy and Natural Resouces of the Republic of Turkey and co-organised with TPAO, BOTAS, The Turkish Association of Petroleum Geologists (TPJD) and The Turkish Chamber of Geophysical Engineers (JFMO).

TUROGE 2008

WEG Central Asian Gas Markets Study

The Central Asian Gas Markets Study has now been published by WEG. A roundtable to discuss the study was held in Almaty on 1 October 2007, the eve of KIOGE.  It was chaired by Lord Fraser, a former energy minister.  Leading energy executives, policy advisers, energy shipping and transportation executives, and representatives of interested governments and inter-government agencies, joined the review.  A subsequent diplomatic briefing, hosted by the Ambassador of Kazakhstan, is due to be held in London in pending the appointment of a new Ambassador.

Upstream China Energy Prospects

A briefing in the New Year will be held looking at the impact of China’s rapid expansion of upstream energy activities and the implications for others involved in global energy markets.

Changes in Global Gas Markets

The Qatar Ambassador has agreed to host the next Women in Energy dinner with the topic of ‘Changes in Global gas Markets’.