Putin wary of U.S. shale gas boom

April 12, 2012 at 7:36 AM

MOSCOW, April 12 (UPI) -- Russian energy companies need to respond to challenges presented by shale natural gas developments in the United States, the Russian president-elect said.

Russia is the world leader in natural reserves and the No. 2 in terms of natural gas production. In terms of shale natural gas, the United States is among the world leaders, however, with at least 827 trillion cubic feet of reserves, the U.S. Energy Department's Energy Information Administration says.

Russian President-elect Vladimir Putin said, in a report to the State Duma, that the Kremlin needed to respond to the U.S. natural gas boom. He said that can "seriously" shape developments in the global energy market, the Platts news service reports.

"National energy companies, obviously, must respond to these challenges," he was quoted as saying.

Neighboring Poland and Ukraine are also pursuing shale gas developments.

Russia supplies Europe with about 20 percent of its natural gas, through various disputes over contracts have prompted members of the European Union to pursue diversification strategies.

Richard Morningstar, U.S. special envoy for Eurasian energy, told an economic conference in Greece last month that Russia "should be diversifying its consumers as well."

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