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Next Cold War? US Gas Drilling Boom Rattles Russia

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But last month Gazprom halted plans to develop a new arctic gas field, saying it couldn’t justify the investment now, and its most recent financial report showed profits had dropped by almost 25 percent.

The U.S. presidential campaigns have already addressed the strategic potential.

A campaign position paper for Republican Mitt Romney said he “will pursue policies that work to decrease the reliance of European nations on Russian sources of energy.”

In early September, President Barack Obama said the U.S. could “develop a hundred-year supply of natural gas that’s right beneath our feet,” which would “cut our oil imports in half by 2020 and support more than 600,000 new jobs in natural gas alone.”

Poland’s Ministry of the Environment wrote in a statement to The Associated Press that “an increased production of natural gas from shale formations in Europe will limit the import via pipelines from Algeria and Russia.”

The issue has reached the highest levels of the Kremlin, too.

Hill, of the Brookings think tank, heard President Vladimir Putin speak in late 2011 at a Moscow gathering of academics and media. She said in a blog post that “the only time I thought that he became truly engaged was when he wanted to explain to us how dangerous fracking was.”

But one top Gazprom executive said shale gas will actually help the country in the long run. Sergei Komlev, the head of export contracts and pricing, acknowledged the recent disruptions but predicted that the U.S. fuels wouldn’t make their way to Europe on any important scale.

“Although we heard that the motive of these activities was to decrease dependence of certain countries on Gazprom gas, the end results of these efforts will be utterly favorable to us,” Komlev wrote in an email to the AP. “The reason for remaining tranquil is that we do not expect the currently abnormally low prices in the USA to last for long.”

In other words, if the marketplace for natural gas expands, Russia will have even more potential customers because it has tremendous reserves.

Komlev even thanked the U.S. for taking the role of “shale gas global lobbyist” and said Gazprom believes natural gas is more environmentally friendly than other fossil fuels.

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Posted by FanningCommunications on Nov 1st, 2012 and filed under News. You can follow any responses to this entry through the RSS 2.0. You can leave a response by filling following comment form or trackback to this entry from your site

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