Putin´s and Gazprom´s war on shale gas must be stopped

The US led shale gas revolution has already killed the Shtokman arctic gas project, but Russia´s Gazprom is - on orders from the Kremlin - continuing to work hard in order to prevent Europe from benefiting from cleand and cheap shale gas:

It’s the world’s largest gas producer, gas exporter, and gas distribution company with nearly 100,000 miles of gas trunk lines and branches. The Russian government owns 50.01% of it. At home, it has to sell gas under cost, one of the Soviet leftovers. It relies on high-profit sales from Europe to make up for it. But Europe is diversifying away from its single most important supplier.

Competitors include Russia’s number two, Novatek, and Norway—the second largest natural gas exporter in the world. So, in April, Gazprom had to lower its European sales guidance for 2012. Its market share in Europe was 27% last year, and it’s shooting for 30% by 2020, but if the US shale-gas boom ever infects Europe, those plans would become a pipe dream—and if the high-profit sales from Europe tapered off further, it would have to raise prices at home, a political nightmare. Hence its fight by hook or crook against shale gas in France.

Gazprom’s “underhanded tactics” and “scaremongering about a new technology” have Moscow’s nod of approval and are designed to dissuade governments from developing their own shale-gas reserves, according to a report by Platts, a global provider of information on energy, petrochemicals, and metals. Efforts include all manner of operations, online and through encouraging demonstrations, but also paying public relation firms to spread “myths and misconceptions,” said Aviezer Tucker, assistant director of the Energy Institute at the University of Texas. A “European Union-wide ban” on shale-gas production, he said, would be the “holy grail.”

With France already knocked off, Sergei Komlev of Gazprom Export has been bouncing around the world in his fight against European shale gas. At a meeting in Qatar, according to Platts’ report, he gave a presentation. “Multiple Handicaps Will Retard Shale Gas Development Outside US” was the title of one of his slides. “Fortunately, it claimed, “European shale gas development faces numerous econombic, regulatory, and political barriers before there are significant amounts of shale gas production, not sooner than in ten or more years.”

Breathing room for Gazprom in the natural gas war. 

Read the entire article here

The shale gas alliance, mentioned in my previous post, is needed also in order to prevent Putin and his allies from destroying a unique chance to get rid of the dependence on Russian energy! 

A shale gas alliance against the EUs "green energy" madness?

A shale gas alliance between the US and such European countries as the UK and Poland would be a step in the right direction, according to conservative economist Przemek Skwirczynski. Not a bad idea! 
Greater still, the BBC quotes another source of information in claiming that the UK has at least 200 trillion cubic metres of shale gas. This would be sufficient for the UK to sell its gas to other countries and not just cover internal demand.

Just one of the potential exploration sites in Lancashire could create some 5,500 jobs with an average salary of GBP 55,000, which seems like just the ticket for the otherwise "lost decade".

Interestingly, Poland also sits on a considerable shale gas field of ca. 22.45 trillion cubic metres with 5.3 trillion available for immediate extraction. Exploration in Poland would create an estimated 155,000 jobs over 10 years and turn Poland into a net gas exporter.

At the moment, similarly to the UK, Poland relies heavily on importing its gas from the very temperamental Russia and, given the historic relationship between these two countries, it would be in Poland's strategic interest to free itself from that marriage of inconvenience. 

Given the potential for a change of guard in Washington, it might be a good time to develop an alliance of shale gas producing countries, in order to rebuild the special relationship on additional economic, as opposed to solely military, principles.

Working with Poland, which seems to be on the Republicans' "friendlies" list, and in any case has been a traditional ally of both UK and USA, could provide a common front to push through gas exploration-friendly policies in Brussels.

Both the United Kingdom and Poland will have to fight their corner in the face of the growing demands from the euro-bloc whose members still largely stick by the economically unviable green energy policies.

Importantly, when it comes to the duumvirate ruling the European Union, France officially suspended its exploration efforts in May 2012 and Germany can be considered Russian Gazprom's man in the EU when it comes to energy.

Hence, both are stumbling blocks on way to shale gas exploration on our continent. After all, despite all the popular sentiment, it is unlikely that we will fully leave, or repatriate powers from the EU, and so the best course of action would be to create alliances to push through our interests.

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Back to the USSR: Putin introduces a Stalinist style re-armament program

Vladimir Putin wants to emulate Stalin´s armament policy
(image wiki)

Some time ago former chess legend - now an opposition politician - Garri Kasparov branded Russian President Vladimir Putin "an oligarch who wants to rule like Stalin" and urged the West not to think of him as a democratic leader. That Kasparov was spot on is obvious when one reads about the de facto dictator Putin´s new drive to emulate the red 
tyrant´s armament policy in the 1930s: 

Russia needs a "leap forward" to rejuvenate its sprawling defence industry, Vladimir Putin said on Friday, harkening back to the ambitious industrialisation carried out by Soviet dictator Joseph Stalin in the runup to the second world war.

"We should carry out the same powerful, all-embracing leap forward in modernisation of the defence industry as the one carried out in the 1930s," Putin told his security council, without mentioning Stalin by name.

Putin´s top defence industry official, Dmitry Rogozin has echoed Putin´s drive back to Stalinist policies (which through executions and terror led to the death of at least six million people): 

Dmitry Rogozin, posted on his Facebook page a copy of a 1940 letter from Stalin to gun factory managers and accompanied it with a sarcastic warning: "Such methods of improving discipline also exist."

Stalin's letter to the managers said: "I give you two or three days to launch mass production of machine gun cartridges … If production does not start on time, the government will take over control of the plant and shoot all the rascals there."

Rogozin said: "Of course, it was a joke," but he added that failures would not be tolerated.

"Our satellites are falling, our ships are sinking, we had seven space failures in the last 18 months but not a single plant felt the consequences," he said after the council session.

"The culprits should come on stage. The country should know them."

Putin plans to spend £430bn in the next eight years modernising the military, with the bulk of the money going to 1,350 defence plants which employ about two million Russians. Many defence sector workers backed Putin during the election.

Read the entire article here

Already last October Russia´s human rights commissioner Vladimir Lukin and several human rights activists warned about attempts to give Stalin credit for the policies in the 1930s: 

"Thanks to heroic efforts and a total disregard for humanity, our country managed to evolve from a backward agrarian country into a backward industrial one during the Stalin era," Lukin said.

Arseny Roginsky, head of the Memorial rights group, said the least the Russian government can do now is "give a legal appraisal to the crimes of the Soviet regime." Roginsky's group has offered a comprehensive package to help raise public awareness of Stalin's crimes, including suggestions for school curriculums.

Andrei Sorokin, director of the Russian State Archives of Social and Political History, warned that Russia will have no future if it fails to assess its difficult past.

"Russian society has been living in a crisis of public consciousness for the past 25 years," he said.

"Any forward movement or attempts to modernize Russia will fail if we don't work out a consensus on our attitudes toward the Soviet past."

Read the entire article here

By openly favoring a Stalinist style armament program, Vladimir Putin has again shown his total disregard for democratic values. 

Angela Merkel and almost half of her cabinet on a kowtowing trip to China

Angela Merkel and her cabinet colleagues are trying to master the old art of  kowtowing  in Beijing.

There was a time when German chancellor Angela Merkel dared to openly criticize China´s communist rulers for the massive human rights violations in their country:

She met with the Dalai Lama, the spiritual leader of the Tibetans, at the Chancellery in September 2007. Opinion polls showed that it was a very popular decision. Beijing, however, perceived the chancellor's behavior as a provocation, especially as Merkel had met with the Chinese prime minister a short time earlier, without telling him about her plans. The mood did not improve when she declined to attend the Beijing Olympics in 2008

Read the entire article here

But that was long ago.

Now the only thing that seems to matter for this lady is money and economic interests. Gross human rights  violations and prison camps with thousands of slave laborers are on the back burner when there is a chance to sell more German Mercedes, Audi and BMW luxury cars to newly rich Chinese: 

"Merkel is far more reserved on human rights issues than she used to be," says Eberhard Sandschneider, director of the German Council on Foreign Relations. "She has a new, more pragmatic approach to Beijing. Now she is more likely to be motivated by classic power politics. The days of reprimands are over." 

Read the entire article here

"The theme is business as usual," said Eberhard Sandschneider, director of the German Council on Foreign Relations. "Don't expect much progress in terms of intellectual-property rights from this visit."

While Germany still exports more to the U.S., and far more to the European Union, than to China, the Chinese market has been one of the fastest sources of growth for German companies in recent years, helping to offset weak growth in advanced economies since the global financial crisis.

German exports to China were 206% higher in 2011 than in 2005, compared with only a 24% increase in exports to the rest of the European Union and 6.3% to the U.S., according to German government data.

Merkel is also joining many previous European beggars in Beijing who have tried to excel in the art of kowtowing: 

In fact, Merkel reportedly plans to directly ask China for aid in combating the ongoing euro debt crisis in Europe. Senior government officials say she will bring up the issue of whether the Chinese would like to directly purchase sovereign bonds of Spain and Italy, the two major ailing euro-zone countries, arguing that their high yields makes them an attractive investment.

Read the entire article here

Although both the Germans and the Chinese are going to put a spin on the "results" of the German visit, Merkel will not have very much to take home from Beijing. The Chinese growth is slowing down, and China is not going to bail out the failed euro countries. 

Great news: Romney ready to sell F-16 jets to Taiwan if elected

Republican presidential candidate Mitt Romney´s stand on Taiwan is excellent news and should be welcomed by all people who believe in western democratic values:

In a recent exclusive interview with the Liberty Times (the Taipei Times’ sister paper), the Romney campaign’s foreign and national security policy director Alex Wong confirmed the presidential hopeful’s inclination to sell the jets.

He added that while US President Barack Obama’s administration has held back on selling the F-16s to Taiwan, “Governor Romney strongly believes that we should sell Taiwan those air fighters to ensure Taiwan’s ability to defend its democracy.”

Saying selling the fighters to Taiwan would increase jobs in the US while maintaining the US’ security benefits in the Asia-Pacific region, Wong also said this was the primary policy difference separating Romney from Obama.

Romney wishes to maintain the “status quo” in the Taiwan Strait and does not recognize the validity of recent calls to abandon Taiwan, Wong said, adding that the US would be standing side by side with its partners in the Asia-Pacific region and work with them to prevent China from engaging in military intimidation of its neighbors.

Romney’s strategy is to encourage China to integrate into the regional and global system led by the US and become a responsible partner, rather than a belligerent power, Wong said.

The development of Asia in the past three decades is incredible and the US wishes for the continuation of regional stability and prosperity, the continuation of free trade, and the development of democracy and human rights, he added.

This is why Romney feels that the US has to maintain a strong military presence in the Asia-Pacific region, so that a rising China would not seek to dominate the region, Wong said.

Read the entire article here

Another casualty of the shale gas revolution: Putin´s pet energy project Shtokman ends in failure

Vladimir Putin´s and Gazprom´s pet project, the Shtokman offshore gas project in the Barents Sea, is the latest casualty of the American shale gas revolution. Putin has failed to keep the project alive despite promising massive additional tax discounts. When there is more than plenty of cheap and clean shale gas available, nobody is interested in bying over-expensive Russian arctic gas. The Shtokman failure is also an enormous blow to Putin´s and his German stooge Gerhard Schröder´s plans to expand the controversial Nord Stream pipeline: 

An official at Russia's top gas producer Gazprom said on Wednesday that the company agreed with partners at Shtokman giant gas enterprise that the project is not feasible for now as the costs are too excessive.

Vsevolod Cherepanov, head of Gazprom's production department, said that Gazprom agreed with France's Total and Norway's Statoil that costs are too high for the project to be implemented at the moment.

"All parties have come to the conclusion that the financing is to high to be able to do it for the time being," he said.

Read the entire article here

Here is some background information, provided by analyst Vladimir Socor:

Initially, the Kremlin and Gazprom had intended to go it alone at Shtokman. President Putin announced (or confirmed) that decision in 2005. One year later, Putin offered to export the lion’s share of Shtokman’s first-phase gas to Germany. At that point, Shtokman was the designated source for the second line of Gazprom’s Nord Stream pipeline to Germany. (That second line’s construction is planned to start during the current year, without a clearly identified supply source for its 27.5 billion-cubic-meter design capacity, even as Nord Stream’s first line of the same capacity is being underutilized). 

The Kremlin soon concluded that development of Shtokman was beyond Gazprom’s means. Gazprom signed a framework agreement with Total and Statoil in 2007 and formed the Shtokman Development AG project company with them in 2008. Departing from the model of production sharing agreements, the Kremlin introduced a special investment vehicle arrangement, reducing its two partners to a status of service contractors in this project. A fully owned subsidiary of Gazprom holds the license to Shtokman resources. Gazprom, Total and Statoil hold stakes of 51 percent, 25 percent and 24 percent, respectively, in the Shtokman Development company. The project company’s main task is to build the offshore infrastructure for the first phase of production. Expected to start by 2013, commercial production was to reach 24 bcm per year in the first phase, a staggering 71 bcm annually in the second phase, and potentially 95 bcm per year in a third phase. 

Under those plans, 50 percent of the production volume was to be exported by pipelines (including Nord Stream) to Europe, and another 50 percent in the form liquefied natural gas (LNG) mainly to the United States. Left behind by the LNG revolution, Russia hoped to catch up by acquiring Western technology from its partners in Shtokman. However, the shale gas revolution left Russia behind again. By 2010, with shale gas over-saturating the US market, Shtokman lost that raison d’etre.

Putin´s life of luxury exposed

                      One tiny part of the "Galley Slave´s" wealth: "The Watches of a Kleptocrat"

Vladimir Putin's expensive taste is one of his "most serious reasons for holding on to power," the Solidarity opposition group said in pamphlet released on Tuesday in Moscow.

In a just-released pamphlet co-authored with Solidarity activist Leonid Martynyuk, Mr. Nemtsov claims that President Putin has at his disposal 20 lavish state villas and palaces, four yachts, a fleet of more than 40 aircraft, 15 helicopters, phalanxes of cars, a collection of luxury wristwatches worth about $700,000, and an alleged personal fortune that may amount to billions of dollars.

Though Putin's official salary is just over $100,000 per year, "with a lifestyle like that, it could be compared to that of a Persian Gulf monarch," say the authors of "Life of a Galley Slave" – the title is a riff on a famous Putin quote, in which he declared that he has "toiled like a galley slave, from morning to night" in his public life.

Most of the assets enumerated in the pamphlet are actually state possessions. Like Soviet commissars of the past, Putin has extensive personal access to a vast empire of property and perks that he does not literally own. Putin has repeatedly denied holding a private fortune.

Nine of Putin's state domiciles, including the lavish Konstaninov palace in St. Petersburg, have been constructed recently on his orders. By contrast with Putin's total of 20 official residences, the president of the United States has just two; even the entire British royal family has only eight state-owned residences at its disposal.

Nemtsov and Martynyuk are actually rather polite in their description of Putin´s reason for holding on to power. The real reason is that the criminal dictator, has made himself a lifetime "president" in order to escape prosecution by a future democratic government.