Power Plays: Shell Predicts Energy Shortage by 2015

WORLD ENERGY WATCH

The World Energy Watch presents recent news and analysis highlighting the activities of the players involved in the power struggle for the world's remaining energy resources.  

1//Calgary Herald, Canada
SHELL PREDICTS ENERGY SHORTAGE BY 2015

Royal Dutch Shell PLC forecasts that global demand for oil and gas will outstrip supply within seven years, chief executive Jeroen van der Veer said in a letter to Shell employees.  "We  are experiencing a step-change in the growth rate of energy demand due to population growth and economic development, and Shell estimates that after 2015 supplies of easy-to-access oil and gas will no longer keep up with demand," van der Veer said in the letter dated Jan. 22.  There'll be a need for more nuclear power and unconventional fossil fuels, such as oilsands, van der Veer wrote.  Shell's production has dropped for four straight years. It is planning to revive growth through projects such as a gas-to-liquids venture in Qatar and oilsands production. 

2//Arab News, Saudi Arabia
KINGDOM ENCOURAGES USE OF HIGH-TECH ON CLIMATE CHANGE

Saudi Arabia has been encouraging greater usage of high-tech solutions to deal with climate change, Prince Abdul Aziz bin Salman, assistant minister of petroleum and mineral resources for petroleum affairs, said.  "These solutions include the advanced technology for separation and storage of Carbon dioxide, especially after fossil-fuel proved to be the first option that will dominate the world market during the 21st century," the prince said.  He made these remarks in an address at the Third Workshop on Building Capabilities for Separation and Storage of Carbon Dioxide in Alkhobar. He called for an authority of oil producing countries in order to develop technologies for the preservation of environment.  "Although the Kingdom will not need the technology of separation and storage of carbon dioxide for the enhanced extraction of the oil in the upcoming years, but it will make many researches and upgrade this technology to have its fair share in confronting the climate change," he said. ... Prince Abdul Aziz reiterated Saudi Arabia's efforts to ensure secure and stable energy supplies required by the world. "The Kingdom is also making strenuous efforts to reduce the effect of increased oil consumption on environment," he said.  In this respect, he referred to an environment fund proposed by Custodian of the Two Holy Mosques King Abdullah. Saudi Arabia has contributed $300 million toward the fund, which aims at establishing an international program for scientific research into energy, the environment and climate change. King Abdullah announced the donation while opening the third OPEC summit in Riyadh last November.  "It has been said that oil has an impact on climate. This is false. Such arguments tend to mix facts with fantasies," the King told the summit, adding that imposing tax on oil would have a negative impact more on importing countries than the oil producers themselves. The King also called for a comprehensive study on oil, the environment and climate change.  "This study must be handled by an independent body free from political pressure and influence," he added.  Prince Abdul Aziz said the King's proposal had received positive reaction from oil producing countries. "Kuwait, Qatar and the UAE have contributed $150 million each bringing the total funds collected for the initiative at $750 million," he added. 

3//The Toronto Star, Canada
CANADIAN CEOs URGE CERTAINTY ON CLIMATE PLAN

Some businesses are becoming hesitant about investing in Canada because of the "policy chaos" on climate change being created by the federal and provincial governments, says the head of the country's top business group.  In a letter to provincial leaders being released Monday in advance of the premiers' two-day meeting in Vancouver, Tom d'Aquino of the Canadian Council of Chief Executives chides the premiers for going it alone on climate change with "different objectives and often inconsistent policies".  "They're all over the map ... it's policy chaos," he said in an interview. 

"We're talking about issues that will have a profound impact on major industries and ultimately Canadian consumers, and if you (governments) all moving in different directions it means you have overlapping regulations, conflicting relations."  He said on issues such as firm emissions targets, on who bears responsibility for cuts to greenhouse gases, on carbon taxes, on establishing a cap-and-trade regime, and others, the federal government and each of the provinces have taken different positions".  D'Aquino said the business lobby isn't criticizing the merits of what each government has proposed - many, he said are moving in the right direction - but he added that they should all get together and work out common approaches to deal with climate change that will give businesses the security of knowing the rules and how they will be applied.  The business group, which represents the country's top CEOs and includes the oil and manufacturing sectors, took the lead on corporate Canada's most sensitive issue by calling for a national strategy on climate change, including leaving open the option of a carbon tax, to make Canada a global "environmental superpower." 

4//EUObserver.com, Belgium
EU-BACKED CARBON CAPTURE AND STORAGE TECHNOLOGY NOT WITHOUT CRITICS

Within the European Commission's comprehensive package of legislative proposals on climate change and energy announced on Wednesday (23 January) is a plan to promote the development of a controversial carbon emissions mitigation technology known as "carbon capture and storage" (CCS).  CCS "captures" carbon dioxide from power plants and stores it in underground geological formations or deep oceans instead of releasing it into the atmosphere.  The climate and energy package includes a series of revised guidelines on state aid for environmental protection that will enable member state governments to support CCS demonstration plants. ... Additionally, under the proposals, carbon dioxide captured and stored will be considered not emitted under the emissions trading system (ETS).  The revision on state aid guidelines is necessary because in the first phases of the technology's development, CCS demonstration projects will require additional finance beyond the incentives from the ETS carbon market, as the current cost of the technology is much higher than the price of carbon.  "CCS will only be deployed if the cost per tonne of CO2 avoided is lower than the carbon price," says the commission.  The commission says that while energy efficiency and an increased use of energy from renewable sources are the primary solutions in the short term, other options are needed in the longer term if Europe and the rest of the world are to achieve a 50% reduction in greenhouse gas emissions by 2050. ... .  However, the technology is not without its critics. The iron and steel industry is very sceptical of the EU's schedule for its development.  "CCS or hydrogen technologies won't be commercially viable before 2020 at the earliest," says Axel Eggert, spokesperson for Eurofer - the European Confederation of Iron and Steel Industries.  The International Energy Agency goes still further. In a 2004 report, the IEA said that as an emissions mitigation tool, CCS only had commercial potential from 2030 in developed countries.  Environmental groups as well think that the technology is unproven and puts hope in a solution that may or may not be realized in time to address carbon dioxide emissions from the power sector.  But fundamentally, environmentalists worry that ideas such as "clean coal" let us think that we can continue to use fossil fuels guilt-free. 

5//RIA Novosti (Russian News & Information Agency), Russia
GAZPROM SET TO CLOSE DEAL ON 51% STAKE IN SERBIAN OIL COMPANY

An agreement to sell 51% in Serbia's NIS oil company to Gazprom Neft, the oil arm of Russian energy giant Gazprom, will be signed on Friday, a source in the Kremlin said on Thursday.  "Intergovernmental agreements on cooperation in the oil and gas sphere and a protocol on the basic terms of Gazprom Neft's acquisition of a 51% stake in Naftna Industrija Srbije (NIS) will be signed in the presence of Russian President Vladimir Putin, Serbian President Boris Tadic, and Serbian Prime Minister Vojislav Kostunica in Moscow on January 25," the source said.  He said the sale of a controlling interest in Serbia's largest oil company would open up prospects of the company's development on a mutually advantageous basis, and guarantee long-term and stable supplies of energy products to the Serbian market. 

Copyright 2008, Gloria R. Lalumia

WORLD ENERGY WATCH

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