VLADIVOSTOK, Russia, Sept. 4 (UPI) -- Russian energy company Gazprom strengthened its grip on the European energy sector in a deal with regional partners to expand a Baltic Sea gas pipeline.
Gazprom Chairman Alexei signed a shareholder agreement on the development of the second phase of the twin Nord Stream pipeline system in the Baltic Sea with his counterparts at German energy companies BASF and E.ON, as well as those from French company ENGIE, Austria's OMV and Royal Dutch Shell.
"Nord Stream 2 will double the throughput of our direct, state-of-the-art gas supply route via the Baltic Sea," Miller said in a statement. "It is important that those are mostly the new gas volumes, which will be sought for in Europe due to the continuous decline in its domestic production."
Under the proposed expansion, two more lines would be added to the existing network running to the German coast, bringing the net aggregate annual capacity to 1.9 trillion cubic feet of natural gas.
The project will be developed by a company named New European Pipeline, where Gazprom would hold a 51 percent share, E.ON, Shell, OMV and BASF would each get a 10 percent stake and ENGIE left with the the remaining 9 percent.
European company leaders said the pipeline expansion will be a crucial link to a more secure energy future. Domestic European natural gas production is waning and conventional Russian gas arteries through Ukraine are at risk from geopolitical and national security factors.
"Nord Stream 2 is a pipeline project directly connecting gas production from Russia with Western European gas markets, thus showing the highest transport security for the customers," Rainer Seele, chief executive officer at OMV, said in a statement. "With this additional import capacity we can further strengthen the gas hub in Central Europe."
The European Union has expressed concern about Russia's control over the regional market as the company typically controls both the transit networks and the reserves they deliver. Earlier this year, the European Commission said that, "ultimately, each member state in the region should have access to at least three different sources of gas."
WASHINGTON, Sept. 4 (UPI) -- U.S. retail gasoline prices moving into the Labor Day holiday are at historic lows, but could be even lower had it not been for refinery problems, AAA said.
"Americans should find good deals on gas prices in most parts of the country heading into the busy Labor Day weekend," AAA spokesman Avery Ash said in a statement.
The motor club reports a national average retail price for a gallon of regular unleaded gasoline at $2.42, about 3 percent less than last week and 8.3 percent lower than one month ago. The average price of $2.60 for August was the lowest for than month since 2005, but still high relative to the cost of crude oil.
The U.S. benchmark price for crude oil, West Texas Intermediate, closed Thursday at $46.75, which is more or less relative to the price for WTI in January.
"Average gas prices are about 41 cents per gallon more expensive than the lowest daily average in January," Ash said. "Gas prices are higher than would otherwise be expected due to high demand and ongoing refinery problems, along with the higher cost to produce summer-blend gasoline that is required in many areas."
An outage at BP's refinery in Whiting, Ind., last month skewed the national average price higher because gas prices in the Great Lakes states spiked by up to 50 cents per gallon. Low output from a Chevron refinery in California, meanwhile, is keeping prices elevated in many regional states.
Lower gasoline prices can also lead to more travel, increasing consumer demand. The Federal Highway Administration said U.S. drivers logged 1.5 trillion miles during the first half of the year, an all-time high. Higher demand for fuel can keep prices at the pump higher relative to crude oil. Demand drops off after Labor Day and refineries start shifting to a winter blend of gasoline that, because of fewer emissions requirements, is cheaper to produce.
"There is good reason to believe that cheaper oil costs, a seasonal decline in driving and the switchover to less costly winter-blend gasoline will continue to push down prices through the end of the year," Ash said. "Gas prices in many parts of the country could fall below $2 per gallon by Christmas if the cost of crude oil remains low."