Geopolitics / Europe

• EU: Tighter Regulations for Explorers

  Bottom Line: The EU’s new offshore oil and gas exploration legislation is designed to prevent another Gulf of Mexico incident and will force explorers to submit special hazard reports and emergency-response plans as well as to demonstrate extended liability coverage. Analysis: The legislation was approved by the European Parliament last week. Specifically, the new legislation requires exploration companies to submit special hazard reports and emergency-response plans BEFORE getting approval to launch offshore operations. Explorers will also be required to prove their ability to cover liabilities in an extended zone of operations up to 370 kilometers off the coast. Previous legislation…

• KURDISTAN: Understanding the Power Brokers

  Bottom Line: Kurdistan is a good place to be right now for E&P companies, but navigating the playing field of power brokers and gatekeepers is a challenging necessity if you want to break into this market—and it’s changing by the day. Analysis: ISA Intel is deep inside Kurdistan and our intelligence paints an interesting picture of the power broker/gatekeeper scene, and it’s a dynamic one. What is most important to understand in Kurdistan is that contrary to popular media stories, the two key political parties—the Kurdistan Democratic Party (KDP) and the Patriotic Union of Kurdistan (PUK)—do not necessarily share an…

• Get Ready for More Energy Unrest in Bulgaria

  Protests over high energy prices brought down the Bulgarian government in February, and elections last week have brought back essentially the same government so we can expect continued protests and instability here. In February, the force of tens of thousands of protesters clashing with police over rising power bills and corruption led to the resignation of the government led by Prime Minister Boiko Borisov as the only avenue for quelling the violence. On 12 May, new parliamentary elections were held, ushering into office Borisov’s own center-right GERB (Citizens for European Development of Bulgaria) party, but with only 30.5% of the…

• POLAND: Gazprom Foments Political Crisis

  Bottom Line: The Polish government claims that EuroPolGaz negotiated a controversial MOU with Russian Gazprom in early April without its knowledge, and now it’s all about damage control over a Russian-Polish pipeline that would bypass Ukraine. Analysis: This is another Gazprom attempt to lash out at Ukraine, which is pursuing energy independence, and the plan is to use Warsaw to punish Kiev. It’s also meant to be a slap in the face to the European Union, which would find itself with another Russian pipeline on its territory in contravention of its energy market legislation. Poland’s treasury minister has already been…

• A Crisis is a Terrible Thing to Waste

  At the onset of the current year, the Spanish government forecasted a much better year in 2013 compared to the dog years of 2008-2012. However, economists have begged to differ, predicting more pain this year for Spain’s economy. Contrary to the norm, it just might happen, that the politicians may be right this time. Unlike Greece, Portugal and Italy, Spain’s government has done the necessary but painful reforms, which in turn has helped boost exports, gain international competitiveness and foster a more flexible labor market. Thus, hope in Spain is no longer wishful thinking.  Prior to 2012, Spain’s labor laws…

• BULGARIA-RUSSIA: Bulgarian Govt Collapse Prompts Lash-Out at Russia

  Bottom Line: Bulgaria’s scrapping of a Russian pipeline deal to carry Russian and Caspian oil to Greece is a response to the government’s collapse in February over energy prices that demonstrate how energy giant Russia can bring down a government. Analysis: Just days after the Bulgaria government collapsed over bloody protests triggered by rising energy prices, the outgoing Bulgarian parliament voted to scrap a pipeline deal to carry Russian oil to Greece. The pipeline deal dates back to 2007 and would have seen 280 kilometers of pipeline carry Russian and Caspian oil from the Bulgarian Black Sea port of Burgas…

• RUSSIA-ISRAEL: New Oil & Gas Geopolitics in the Mediterranean

  Bottom Line: Russia’s announcement this week that a Gazprom subsidiary had signed a deal for Israel’s offshore Tamar gas field will exponentially strengthen Gazprom’s prowess in the massive Asian LNG market. (Israel has yet to approve the deal, but it will—it’s needs the money for infrastructure and it needs the deal for a new geopolitical landscape). Analysis: What Russia has right now is a single LNG plant in its Far East (Sakhalin-2), supplying LNG to South Korea and India (though it plans to build another plant in Vladivostok). With the Israel deal, it will gain direct export access to Japan,…

• Is Cameron About to Kill the EU

  Incident: British Prime Minister David Cameron is dangling a big choice before the country’s voters should his party win the next election: whether or not to quit the European Union.  Bottom Line: This would be the death knell for the European Union. It would also have disastrous implications for the EU’s efforts in the Western Balkans, whose countries are just on the cusp of membership in the bloc. Analysis: This would have a particularly negative effect on Bosnia-Herzegovina, which has made insufficient progress on reforms necessary for EU integration. The country’s biggest political parties—three of them guided solely by ethno-nationalist…

• Albania – Dubious Deals

  Incident: The sale of Albpetrol to ostensibly US-based Vetro Energy in September has been stalled after Vetro failed to make the deposit to back the guarantee. Vetro Energy was the highest bidder, with a $1.1 billion offer (€850 million), more than triple the value of Albpetrol’s assets. Bankers Petroleum of Canada—the largest producer in Albania and the key company responsible for developing Albania’s oil fields—also bid for Albpetrol, but was excluded in the first round with a lower bid of €304 million. In a private investigation at the time of the bidding process, Oilprice intelligence networks uncovered the true ownership…

• Europe Has Had Enough, But Can It Stand Up to Gazprom?

  Gazprom has Europe’s natural gas market in a stranglehold and Europe is attempting to fight back, first with a raid last year on the Russian giant’s offices and then with a probe launched earlier this week against its allegedly illicit efforts to control the EU’s natural gas supplies. The bottom line is that the same natural gas revolution in the US, which was enabled by hydraulic fracturing (fracking), is now threatening to loosen Gazprom’s noose on the EU, and Gazprom simply won’t have it.    To head off a potential natural gas revolution in the EU, Gazprom is pulling out all…