Energy Watchblog

Lithuania's Romas Švedas is one of the most renowned Baltic energy experts

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With over 20 years of experience in international relations and over half of the time devoted to energy issues, Lithuania's Romas Švedas is one of the most renowned Baltic energy experts.</div>
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His expertise in the field of international economic relations spans negotiator’s skills in the signing Lithuania’s Free Trade Agreements with Nordic, Baltic and Central European countries, negotiating the Lithuanian membership in the World Trade Organization (WTO), sitting as a member of bilateral intergovernmental commissions with <span style="color: #0854d1;">Russia</span>, <span style="color: #0854d1;">Ukraine</span>, <span style="color: #0854d1;">Belarus</span> and being head of Lithuanian delegation in bilateral intergovernmental economic relations commission with China.</div>
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In the field of energy policy, being vice-minister of the Lithuanian Energy Ministry (2009-2011) he was responsible for electricity interconnections with <span style="color: #0854d1;">Poland</span> (LitPolLink) and Sweden (NordBalt), LNG terminal, exploration of UGS, decommissioning of the Ignalina Nuclear Power Plant and development of a new Nuclear Power Plant project (Visaginas NPP).</div>
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Švedas was a member of the Baltic Energy Market Interconnection Plan (BEMIP) drafting team and representative of Lithuania in BEMIP High Level Working Group (2008-2011). During the period of 2009-2011 Romas Švedas was chairman of the Boards of State Enterprise “Ignalina Nuclear Power Plant”, AB “Klaipedos nafta”, AB “Litgrid” and member of the Board of AB “Lietuvos dujos”.</div>
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Švedas kindly agreed to answer <i style="border: 0px; margin: 0px; padding: 0px;">Natural Gas Europe's</i> questions on a broad range of energy issues in the Baltic region.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">What are the specifics of the Baltic nations’ energy market? And how do they pertain to the challenges they face?</b></i></div>
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The bottom line is this: the countries - Lithuania, <span style="color: #0854d1;">Latvia</span> and <span style="color: #0854d1;">Estonia</span> -are the members of the European Union, and therefore are bound to the EU policies, including those in energy market.</div>
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Though all the three countries have their own peculiarities of market economy, their underlying common problem is what the EU refers to as the Union’s energy island.</div>
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It means that the countries’ energy infrastructure is historically linked with the former Soviet Union. Effectively, there are no any significant power connectors between them and the Western Europe, except a tiny power link connecting Finland and Estonia.</div>
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The Baltic States’ biggest challenge is the dependency on the single external gas supplier, Russia’s G<span style="color: #0854d1;">azprom</span>. In that sense, Lithuania looks the worst as its reliance on external energy supplies in satisfying its energy needs hovers at a whopping 80 percent, the EU record. And when it comes to gas sector, Lithuania’s dependency on Russian Gazprom gas is at 100 percent, while electric power import amounts to the EU record-high 70 percent, according to the Eurostat.</div>
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The shutdown of the Ignalina Nuclear Power Plant in 2009, a prerequisite for the EU accession in 2004, has significantly exacerbated power supply. In fact, Lithuania has gone from power exporter to the biggest importer in entire Europe.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">What are the biggest challenges in decreasing the energy supply dependency?</b></i></div>
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Without doubt, they are in diversifying energy supply, in other words, creating alternative energy sources. Lithuania has been pursuing that along with Latvia and Estonia in the framework of BEMIP- Baltic Energy Market Interconnection Plan tasked with interconnecting Lithuania, Latvia and Estonia internally -very determinedly and consistently.</div>
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What I often see happening in the Baltic region separate energy projects sometimes are prioritized as the key objectives of whole energy market.  In particular, when it comes to Lithuania, it often boils down to a few things: to build a nuclear power plant, or not?  Explore and extract shale gas, or not?</div>
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In the reality, these two I see as the only ways in achieving the ultimate goal of energy security and independency.</div>
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No doubt, the main priority in Lithuania should be diversification of energy supplies- guaranteeing that market conditions function in energy sector. That can be possible only with more than a single energy supplier.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">How can this be achieved?</b></i></div>
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I believe that could be done in two ways.</div>
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First, on the legislative level, Lithuania has to pass and enact necessary energy security- oriented legislature. Other two Baltic counties need to do the same.</div>
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Second, implementation of EU-supported interstate energy projects in the region in quintessential.</div>
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Speaking of the legislation, what the three Baltic States have to do effectively boils down to one key thing:  transpose the EU energy legislature into theirs and, importantly, make sure it is implemented.</div>
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The core piece of the EU legislation is the EU Third Energy Package.</div>
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Namely it, encompassing gas and electricity supply development directions, is the integral part of BEMIP.</div>
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Today the situation is the states in electricity sector development need to step up, as the implementation of the Third Energy Package-and BEMIP- is lagging behind.</div>
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Having said that, I have to note the countries have all the necessary projects to make the breakthrough in the pursuit of energy security and independence. EstLinkII, NordBalt, LitPol are among the most important, and they have to be launched until the end of 2015.</div>
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When kicked off they will ensure the EU-bound transmission capacity on the same scope we have now it with the East.</div>
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Without any doubt, the implementation of the afore-mentioned power projects would significantly enhance energy security and supply in the Baltics and secure the countries’ full and equivalent operations on the Nord Pool Spot (NPS) Exchange.</div>
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The power projects are being implemented on time, and their completion promise a lot brighter energy future for each of the Baltic States.</div>
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What should matter to foreign investors in regard to the latter is the countries’ power trading on the NPS is transparent and promising good prospects as with the completion of the projects by 2016 the systemic problems in Baltic power market will have been solved.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">What’s your take on construction of nuclear power plant in the Lithuanian town of Visaginas?</b></i></div>
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Regardless whether it will be pursued or not (the governments of Estonia, Latvia and Lithuania are set to make up their minds on the project yet this month -<i style="border: 0px; margin: 0px; padding: 0px;">Natural Gas Europe</i>), the atomic power project, like other energy project in the region, would be regional.</div>
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This is what matters most.</div>
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Sometimes I get the sense that foreign countries believe that each of the Baltic States pursue their energy projects separately.</div>
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It’s not true- all the projects are regional, with the fact in mind that starting 2016 the countries will be an integral part of the EU single energy system.</div>
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Speaking of the nuclear project, I’d not dare to predict its fate, but- again- it will be a regional decision of governments of Latvia, Lithuania and Estonia.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">What are the other specifics of Lithuania’s gas sector besides the 100 percent dependency on Gazprom gas?</b></i></div>
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I call gas sector more interesting than the power sector in terms of predictability, implementation of projects and etc.</div>
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Power sector will definitely be the first one to fully reach the goal of energy independence and become the leverage to the single supplier.</div>
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Speaking of gas-fired generators, what sets Lithuania apart from Latvia and Estonia is that a very significant part of power in Lithuania is being generated by traditional generators, i.e using gas.</div>
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Meanwhile, Estonia has successfully employed oil shale and Latvia has been successfully taking advantage of its hydro resources.</div>
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Unlike in power sector, the situation in Lithuania’s gas sector is a whole lot more complicated.</div>
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Again, I’d like to look at it from the standpoint of legal basis and the development of infrastructure.</div>
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When it comes to gas legislature, having passed the law of gas supply and started ownership unbundling, which means separating gas supply from gas mains management, Lithuania has moved considerably forward in the recent years.</div>
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 Sure, within the framework of the EU Third Energy Package.</div>
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But unlike the Baltics’ power market, Lithuania, Latvia and Estonia still do not have a single internal gas policy despite the Third Energy Package obligations.  The 100 percent dependence on the single external gas supplier, certainly, exacerbates the situation.</div>
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In tackling it, Lithuania is advancing a Liquefied Natural Gas Terminal that is due at the end of 2015. Along with the EU-supported gas Lithuanian and Polish gas interconnector due by 2019 the two are an important stride in diminishing the dependency.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">What about Lithuania’s shale gas? Could it be a third alternative?</b></i></div>
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Sure. It could be also an alternative in the energy security pursuit.</div>
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Lithuania had the investor, Chevron, but, unfortunately for us, we could not provide it a stable legislative basis, and it left.</div>
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That is disappointing as shale gas can significantly boost out energy security. It has been proven by Kaunas Vytautas Magnus University scientists.</div>
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Unfortunately for us, we do not yet possess the good experience Poland has in taking advantage of shale gas and dealing with the local communities that now often are adverse to the shale gas exploration.</div>
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I agree with some international observers that Lithuania seems to be artificially escalating the issue of shale gas exploration-related environmental issues.</div>
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I’m not saying they do not matter, not at all, but sometimes I strongly suspect some pro-Russian interests are underneath the clamor against shale gas exploration in Lithuania.</div>
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Interestingly, some of the billboards on Lithuanian highways urging to resist the American company and the shale gas bid appeared to be build- and paid for- by some unclear subjects.</div>
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This is what a journalistic investigation revealed.</div>
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And we’re talking here only of large billboards all see when driving by.</div>
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I sometimes wondered who stood behind the negative, anti-shale gas coverage in traditional media outlets.</div>
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There is really a lot to think of but I really would not like to delve into the details, and why the tender failed. But when speaking of the Chevron bid it was obvious that we lacked a political will in making in happen. As a result, the vociferous protests in the provinces and not only it. The attitude of the people needs to be addressed in the future.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">Do you believe the dispute between Lithuania and Gazprom over gas price will be settled any time soon? And how?</b></i></div>
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Perhaps not as much is important the outcome of the dispute as is important the pending ruling at the Stockholm Arbitration Tribunal. If it ruled in favor of Lithuania, which is pretty likely, it would establish an unseen yet precedent, meaning a crucial breakthrough in the Gazprom relations with the Central and Eastern Europe. Practically, it would lead to huge civil lawsuits against Gazprom, coming from Latvia, Estonia, Moldova, Ukraine, Belarus and some other countries.</div>
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I am convinced Gazprom is really anxious about that.</div>
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I believe it is not now as much preoccupied with the gas price for Lithuania and a new contract with it, as with the fallout from the Tribunal ruling.</div>
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I am certain Gazprom will go to big lengths to shun the judicial precedent, but it cannot get away from the EU Third Energy Package ownership unbundling requirements. This is what Gazprom fears a lot, too.</div>
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We might be witnessing some historical shifts in the field of energy, without an exaggeration.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">How can Lithuania take advantage of the European Commission (EC) resolve to sue Gazprom for EU Anti-Trust law breaches?</b></i></div>
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No doubt, it is also a headache for Gazprom as it could set a very far-reaching precedent for the company that in the course can effectively change the relations between it and entire countries, the gas buyers.</div>
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<i style="border: 0px; margin: 0px; padding: 0px;"><b style="border: 0px; margin: 0px; padding: 0px;">How much serious do you believe is Russia’s intention to build a LNG terminal in the enclave of Kaliningrad? Would it be pursued to bypass gas transit through Lithuania?</b></i></div>
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There has been news Russia has already built an underground gas repository in Kaliningrad.  Russia has certainly a big potential in gas sector, so I’d not be surprised if it pursues the LNG project in the exclave. Sure, it is not a thing of the nearest future.</div>
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But what matters to Lithuania is a liquefied natural gas terminal in Kaliningrad would enable Russia to stronger manipulate the card of gas supply to Lithuania.</div>
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Having built the underground gas storage facility and mulling construction of a LNG terminal, Russia sends a signal to Lithuania that Kaliningrad will be the first one to secure gas supply from alternative sources. In other words, under certain Lithuania-adverse circumstances, and with the Kaliningrad gas facilities in place, Russia could cut gas supply to Lithuania without giving much thought.</div>
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I see it as Russia’s clear message that it will keep using energy issues as a tool of its politics.</div>
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Hence, the importance of the Baltic energy projects.</div>
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<span style="background-color: #f7f5f5; color: #333333; font-family: 'Georgia Serif'; font-size: x-small; text-align: center;">- See more at: http://drillwatchblog.blogspot.com/2013/12/baltics-update-from-romas-svedas.html#sthash.6Ox2gN9g.dpuf</span>

Lithuania's Romas Švedas is one of the most renowned Baltic energy experts

With over 20 years of experience in international relations and over half of the time devoted to energy issues, Lithuania's Romas Šv...

Infinity completed 2D seismic of Nicaragua O&G

<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh54a6Io73WZOiMldesoMjPlL2DoQfrEr_Gp2V-HDJF0qh3z1bwl8xIIQk9uLgnc4kkcjaz6xnswHzpzP8kuxvj8_BK-DQHUbF9Oh0rNvymDD43XX5qif1_CEq3529i_5cHAcSzzfjQADVG/s1600/FBjan09_ion_big.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="257" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEh54a6Io73WZOiMldesoMjPlL2DoQfrEr_Gp2V-HDJF0qh3z1bwl8xIIQk9uLgnc4kkcjaz6xnswHzpzP8kuxvj8_BK-DQHUbF9Oh0rNvymDD43XX5qif1_CEq3529i_5cHAcSzzfjQADVG/s320/FBjan09_ion_big.jpg" width="320" /></a></div><div style="background-color: white; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 13px; line-height: 18px; margin-bottom: 20px;">Infinity Energy Resources<span style="line-height: 1.6em;"> has completed a 2D seismic survey covering selected areas within its offshore Nicaragua oil and natural gas concessions, the company said in a release.</span></div><div style="background-color: white; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 13px; line-height: 18px; margin-bottom: 20px;"></div><div style="background-color: white; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 13px; line-height: 18px; margin-bottom: 20px;"></div><div style="background-color: white; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 13px; line-height: 18px; margin-bottom: 20px;">The 2-D seismic mapping was conducted by geosciences firm CGG (NYSE: CGG) on both the Tyra and Perlas blocks that comprise Infinity's concessions, which cover some 1.4mn acres (566,560ha).</div><div style="background-color: white; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 13px; line-height: 18px; margin-bottom: 20px;"></div><div style="background-color: white; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 13px; line-height: 18px; margin-bottom: 20px;"></div><div style="background-color: white; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 13px; line-height: 18px; margin-bottom: 20px;">Infinity will work with CGG to schedule a 3-D seismic survey in the second quarter of 2014.</div>

Infinity completed 2D seismic of Nicaragua O&G

Infinity Energy Resources has completed a 2D seismic survey covering selected areas within its offshore Nicaragua oil and natural gas conce...

Repsol closes a multi Billion USD deal with Shell for assets in LATAM

<div class="text-contenido" style="background-color: white; margin: 0px 10px 0px 0px;"><div style="line-height: 18px; margin-bottom: 20px;"><span style="font-family: inherit;">Spanish oil company <a document-type="company" href="http://www.bnamericas.com/company-profile/en/Repsol_YPF_S,A,-Repsol_YPF" style="color: #001b96; text-decoration: none;">Repsol</a> (NYSE: REPYY) has closed the US$4.1bn sale of its LNG assets in Peru and Trinidad and Tobago to Anglo-Dutch oil giant <a document-type="company" href="http://www.bnamericas.com/company-profile/en/Royal_Dutch_Shell_plc-Shell_Group" style="color: #001b96; text-decoration: none;">Shell</a> (NYSE: RDS), according to a company press release.</span></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"><span style="font-family: inherit;">In October, Repsol sold its US$200mn stake in Bahía Bizkaia Electricidad (BBE) to UK-based major <a document-type="company" href="http://www.bnamericas.com/company-profile/en/BP_P,L,C,-BP" style="color: #001b96; text-decoration: none;">BP</a> (NYSE: BP)<strong>. </strong>Together the sales have generated Repsol US$2.9bn in profit and capital gains after tax.</span></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"><span style="font-family: inherit;">Shedding financial commitments and non-consolidated debt, the transaction has also reduced Repsol's net debt by US$3.3bn.</span></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"><span style="font-family: inherit;">With an estimated 5bn euros (US$6.865bn) of assets sold, Repsol has now surpassed its 2012-2016 divestment plans of 4bn to 4.5bn euros.</span></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"></div><div style="line-height: 18px; margin-bottom: 20px;"><span style="font-family: inherit;"><span style="line-height: 1.6em;">Additionally,</span><span style="line-height: 1.6em;"> </span>Repsol<span style="line-height: 1.6em;"> </span><span style="line-height: 1.6em;">and Shell signed a supply agreement with Canadian</span><span style="line-height: 1.6em;"></span>regasification<span style="line-height: 1.6em;"> </span><span style="line-height: 1.6em;">terminal</span><span style="line-height: 1.6em;"> </span>Canaport<span style="line-height: 1.6em;"> </span><span style="line-height: 1.6em;">for approximately</span><span style="line-height: 1.6em;"> </span>1Mt<span style="line-height: 1.6em;"> </span><span style="line-height: 1.6em;">over a 10-year period.</span></span></div><div style="font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 1.1em; line-height: 18px; margin-bottom: 20px;"></div></div><div class="box1" style="background-color: white; float: left; font-family: Arial, Helvetica, 'Helvetica Neue'; font-size: 12px; line-height: 16px; margin-bottom: 20px;"><div class="col1-DN" style="float: left; padding: 0px 20px 0px 0px; position: relative; width: 203px;"><div class="box7" id="tag-903"><h1 style="border-bottom-color: rgb(153, 153, 153); border-bottom-style: solid; border-bottom-width: 1px; color: #414042; font-family: Arial, Verdana, Geneva, sans-serif; font-size: 17px; height: 44px; margin: 0px; overflow: hidden; position: relative;"></h1></div></div></div>

Repsol closes a multi Billion USD deal with Shell for assets in LATAM

Spanish oil company Repsol (NYSE: REPYY) has closed the US$4.1bn sale of its LNG assets in Peru and Trinidad and Tobago to Anglo-Dutch oil...

China: Technip and COOEC form joint venture to address the booming deepwater market in China

<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEijso1mfw-2wRxYmMr7kB56e4To58n0n5W6Rs6VRGg0fsrfH0iCPJfaJs4qB1d4hSLe1mBFtr2QKEdeskLzWXrjORVtYvmdqWnvgfunw0UeOPW_XKdAzjwXAc8JzOIQhuK1WcCIANhsqNOJ/s1600/china-map-6.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEijso1mfw-2wRxYmMr7kB56e4To58n0n5W6Rs6VRGg0fsrfH0iCPJfaJs4qB1d4hSLe1mBFtr2QKEdeskLzWXrjORVtYvmdqWnvgfunw0UeOPW_XKdAzjwXAc8JzOIQhuK1WcCIANhsqNOJ/s320/china-map-6.jpg" width="313" /></a></div><a href="http://www.technip.com/en"><i>Technip</i></a> and<i><b> China Offshore Oil Engineering Co (COOEC)</b></i>, the largest offshore engineering and construction company in China, have signed a joint-venture agreement in September.<br /><br />The five-year agreement, which builds on existing relationships,  combines the know-how, technical resources, complementary assets as well  as commercial and financial capabilities of both companies to target  deepwater engineering, procurement, construction and installation (EPCI)  Subsea Umbilicals, Risers and Flowlines (SURF) projects at a water  depth greater than 200 meters in China.<br /><br />This agreement follows the successful award, at the end of 2012, to the COOEC-Technip Consortium of the <i><b>CNOOC Panyu 34-1/2 development project</b></i>.

China: Technip and COOEC form joint venture to address the booming deepwater market in China

Technip and China Offshore Oil Engineering Co (COOEC) , the largest offshore engineering and construction company in China, have signed a ...

Trinity completes Galeota license upgrades

<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhI7Z0QP0zJtguyzglQu9bPxxFs5kIs9v3HXsRXLuHIJlGqwmoyvoJoEDiU3XLnHIXieLL1Jsnl9cQjqqW5hxHeCOyaFjJZ8XCk-aRm4nGPxWBpMRCocHiFwSDznFUOMf7si3JJZaG4smpn/s1600/EarthLights_660x450.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="218" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhI7Z0QP0zJtguyzglQu9bPxxFs5kIs9v3HXsRXLuHIJlGqwmoyvoJoEDiU3XLnHIXieLL1Jsnl9cQjqqW5hxHeCOyaFjJZ8XCk-aRm4nGPxWBpMRCocHiFwSDznFUOMf7si3JJZaG4smpn/s320/EarthLights_660x450.jpg" width="320" /></a></div>Trinidad and Tobago-focused E&P firm Trinity (AIM: TRIN) completed Rig 2 upgrades at its Galeota license offshore Trinidad, according to a release by the firm.<br /><br />The upgrades will improve drilling efficiency and reduce costs, said the firm.<br />Infill  drilling operations on the producing Trintes field have been delayed by  bad weather but will recommence shortly with the spudding of the B9  well, which is expected to take up to 45 days to complete, said Trinity.<br /><br />Additionally, Trinidad state oil company Petrotrin  converted its 35% interest in the Trintes field to an over-riding  royalty (ORR), upping Trinity's working interest in the field to 100%,  and adding an additional 13Mb in 2P reserves and 470b/d in production,  according to the release.<br />Trinity also recently  signed a new crude oil sales agreement with Petrotrin, harmonizing the  pricing of crude from the Trintes field with Trinity's other sales  agreements under which pricing is linked to WTI.

Trinity completes Galeota license upgrades

Trinidad and Tobago-focused E&P firm Trinity (AIM: TRIN) completed Rig 2 upgrades at its Galeota license offshore Trinidad, according to...

E&P companies in Neuquén to invest up to US$6bn in 2014

<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhaVDRJp4iG581JyIaH0zcTN26aEoFWujEt4fg2-PUMpBc-IHNDSXMq1ZEKbMr5LWnkNXIprXiAHM1zlU9qJ7ric_i9l2nPS02cxIx-SLkIlP0WUv_3ZV46glhXXfuufwwJjrtuHQGRLBbl/s1600/vaca_muerta_basin.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="237" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhaVDRJp4iG581JyIaH0zcTN26aEoFWujEt4fg2-PUMpBc-IHNDSXMq1ZEKbMr5LWnkNXIprXiAHM1zlU9qJ7ric_i9l2nPS02cxIx-SLkIlP0WUv_3ZV46glhXXfuufwwJjrtuHQGRLBbl/s320/vaca_muerta_basin.jpg" width="320" /></a></div>Oil and gas companies are expected to invest between US$5bn and US$6bn in 2014 in the Argentine province of Neuquén, according to local press, citing a report by the provincial government. The forecasted investment for next year represents a significant increase from the US$4.1bn invested in Neuquén E&P in 2013.<br /><br />Unconventional plays will receive the majority of the capital influx, with the Vaca Muerta shale play taking approximately 60% of the total. Of the 635 wells to be drilled next year, 323 will target shale and tight sand deposits as opposed to 195 of the 471 wells drilled in 2013.   Topping the list, national oil company YPF's (NYSE: YPF) investment in the province is expected to reach US$3bn. YPF will destine the funds primarily to its Loma La Lata shale, and its El Orejano and Rincón del Mangrullo tight gas pilot projects with Chevron (NYSE: CVX), Dow Chemical (NYSE: DOW) and Pampa Energía (NYSE: PAM) respectively.<br /><br />While other firms focus on exploration, France's Total (NYSE: TOT) will be the only one, apart from YPF, working on an unconventional pilot project in the province. Called Aguada Pichana, Total is expected to invest US$380mn on the 20-well Vaca Muerta pilot.     ExxonMobil (NYSE: XOM) plans to invest approximately US$250mn, according to the reports, followed by US$185mn from Pan American Energy, who will focus on exploration of the Lindero Atravesado formation.<br /><br />Petrobras (NYSE: PBR) will invest US$113mn, primarily on its Río Neuquén and El Mangrullo areas. O&G Developments, a subsidiary of Shell (NYSE: RDS.A) in Argentina, will invest at least US$90mn (max US$500mn) on its Sierras Blancas license.     Meanwhile, Wintershall is rumored to have signed a definitive partnership with provincial oil company GyP to drill a dozen wells on the Aguada Federal block.

E&P companies in Neuquén to invest up to US$6bn in 2014

Oil and gas companies are expected to invest between US$5bn and US$6bn in 2014 in the Argentine province of Neuquén, according to local pres...

Northern Petroleum firms up Italy potential

<div class="separator" style="clear: both; text-align: center;"></div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhSHR5mOyCBEMvgABTccE_m7X4frlguisMOJsg79We1gSPMbvWrqWbhM81RaSktnXrz_lHniRDk9-RsqvVXFSI4oFjupF-XByYFSAwLUxeGx24kdgw7alvVTbUAd9AwEDRkgtLuYawGtXHC/s1600/italy350_52b93a313e67f.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" height="266" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhSHR5mOyCBEMvgABTccE_m7X4frlguisMOJsg79We1gSPMbvWrqWbhM81RaSktnXrz_lHniRDk9-RsqvVXFSI4oFjupF-XByYFSAwLUxeGx24kdgw7alvVTbUAd9AwEDRkgtLuYawGtXHC/s320/italy350_52b93a313e67f.jpg" width="320" /></a><a class="companyPopupTrigger" href="http://www.proactiveinvestors.co.uk/companies/overview/1150/Northern+Petroleum" rel="1150" style="background-color: transparent; border: 0px; color: #df8d00; font-family: inherit; font-style: inherit; font-weight: bold; margin: 0px; outline: 0px; padding: 0px; text-decoration: none; vertical-align: baseline;">Northern Petroleum</a> (<a class="companyPopupTrigger" href="http://www.proactiveinvestors.co.uk/companies/overview/1150/northern-petroleum-1150.html" rel="1150" style="background-color: transparent; border: 0px; color: #df8d00; font-family: inherit; font-style: inherit; font-weight: bold; margin: 0px; outline: 0px; padding: 0px; text-decoration: none; vertical-align: baseline;">LON:NOP</a>) has told investors that the proved and probable (2P) reserves for the Rovesti and Giove discoveries in the southern Adriatic sea will be downgraded to contingent resources.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">This comes as NOP’s contractor ERC Equipoise submitted its interim findings of a resources review of the two assets.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">The company says it will be able to add value to the discoveries through a credible appraisal and development programme.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">"The Southern Adriatic permits have the potential for significant upside value to the company in the short to medium term,” said chief executive Keith Bush.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">“Any work to further our understanding of the geological model or to successfully negotiate the Italian political environment will increase the chance of realising that upside for shareholders.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">“Giove, in particular, is a very interesting discovery which will demonstrate its worth through a credible development plan."</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">In 2007, NOP booked 53.2mln barrels of 2P oil reserves for Rovesti and Giove.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">Now, ERC estimates a total of 30.2mln contingent resources: 25.8mln at Giove and 4.4mln at Rovesti.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">NOP also told investors that it has been unofficially told by the Italian authorities that more information will be needed in relation to permitting for a proposed 3D seismic programme over the two permits.</div><div style="background-color: white; border: 0px; color: #3e3e3e; font-family: Arial, Helvetica, sans-serif; font-size: 12px; line-height: 16px; outline: 0px; padding: 0px 0px 12px; vertical-align: baseline;">It says that it understands that this request has been made of all outstanding applications in the area, and it will continue to work with the Environment Ministry to obtain the necessary approvals for the programme.</div>

Northern Petroleum firms up Italy potential

Northern Petroleum ( LON:NOP ) has told investors that the proved and probable (2P) reserves for the Rovesti and Giove discoveries in the s...