UPI Energy Watch

Russia pitches natural gas consortium

Russian Prime Minister Vladimir Putin proposed there should be a consortium for Russia's European natural gas customers to purchase gas from Russia to provide to Ukraine.

Putin first pitched the idea to Paolo Scaroni, chief executive officer of Italy's gas corporation Eni, ITAR-TASS reports.

Italy is Russia's second-largest natural gas customer in Europe.

"We propose to our European partners to share the risks of these transits and to organize a consortium that would purchase the necessary amounts of process gas for Ukraine, deliver it immediately there and organize the transits," Putin said.

Relaunching Ukraine's gas pipelines would require the consortium to purchase 1.78 billion cubic meters of gas from Russia.

"Ukraine stands in need of gas for ensuring the operations of compressor plants, and this is bigger than 140 million cubic meters, this is 1.78 billion cubic meters," Putin said.

Scaroni indicated Eni would possibly join such a venture.

Also during the visit, Gazprom and Eni agreed to increase the pace of work on the South Stream pipeline project.

Expediting the construction of the pipeline would bring an alternative natural gas transit route faster. The South Stream will directly link Russia and Europe.

Nigeria invests $16 billion in oil and gas

Nigerian government officials signed a $16 billion oil and gas development agreement with Dubai World Corp., an arm of the United Arab Emirates Ministry of Commerce.

The agreement not only allows for investment in power, oil and gas, it also includes real estate and agriculture, Nigeria's The Guardian reported.

"This will further complement (the) government's budgetary efforts in bringing development to the Ministry of Niger Delta, which is one of the critical ministries,'' said Nigerian Minister of Justice Michael Aondoakaa. It is "one of the biggest commitments by any bloc of the world to look into what is happening in Africa."

Violence in the Niger Delta has hurt oil and gas production in the region and deterred investment.

"We believe that the agreement we are going to sign with the Nigeria National Petroleum Corp. will enhance the production of oil and gas in the country," said U.A.E. businessman Sultan Ahmad Bin Sulayem.

Australia's Woodside Petroleum finds oil in Libya

The test well at Woodside's New Field Wildcat well in the Ghadames Basin, south of Tripoli, produced oil at a rate of 280 barrels per day and produced gas at a rate of 10 million cubic feet per day.

Woodside is the operator of the well and has a 37 percent stake, and Libya's National Oil Corp. has a 63 percent stake in the well, The Australian reports.

Woodside also announced it is suspending work on its planned OceanWay liquefied natural gas terminal off the coast of California.

"We must acknowledge the impact of the current market and have notified the regulatory agencies that we are withdrawing our application for the time being," said Woodside Natural Gas President Steve Larson.

The OceanWay terminal would have received LNG shipped from Woodside's gas fields off the coast of Australia. The canceled facility would have converted the LNG back to natural gas and piped it to Los Angeles.

--

Closing oil prices, Jan. 16, 3 p.m., London

Brent Crude oil: $46.66

West Texas Intermediate crude oil: $37.33

--

(e-mail: energy@upi.com)