Oil and Gas Pipeline Watch

South Stream route expected soon

Host nations for the planned South Stream pipeline to Italy and Austria will meet in Bulgaria in April to sign contracts for the construction of the route.

Bulgaria hosts an international energy forum hosted by President Georgi Parvanov in the city of Plovdiv from April 24-25.

The proposed South Stream pipeline would bring an estimated 1.1 trillion cubic feet of natural gas from Central Asia and Russia to Italy and Austria through the Balkans. Planners anticipate a launch date of 2013.

Serbian Energy Minister Petar Skundric met with Alexander Medvedev, deputy chairman of Russian gas monopoly Gazprom, in Belgrade to inform him of construction plans for South Stream, Bulgaria's Standart newspaper reports.

Plans to build portions of the pipeline through Bulgaria, Hungary and Serbia have been approved already by their respective governments. Final details on the route for the project, however, are not expected before September.

Beijing inks energy deal with Myanmar

The Chinese government signed a deal with the military junta in Myanmar for the construction of oil and gas pipelines and hydroelectric projects, officials said.

The deal concerns more than 1,000 miles of pipeline stretching from southern China to Myanmar. The route would be a less expensive alternate to tanker shipments across the Malacca Strait.

The government in Beijing is expected to fund the majority of the $1.2 billion project and proceed with construction later in the year.

The deal is expected to further marginalize India's influence over Myanmar while bringing China closer to its goals of a southern export outlet, The Times of India reports.

The pipeline deal comes on the heels of a visit to Myanmar by Li Changchun, a top official in the Politburo Standing Committee of the Communist Party of China.

"China will continue to encourage competent enterprises to invest in Myanmar or participate in your infrastructure construction," Li said.

The deal also concerns cultural exchanges as well as Chinese assistance for Myanmar's telecommunication and transport sector.

Alaskan gas can develop if will exists

Political obstacles confronting the development of natural gas pipelines in Alaska are not overwhelming if the will for cooperation exists, executives said.

Drue Pearce, the federal coordinator for Alaska natural gas transportation projects, told developers the rival projects -- the Denali gas pipeline and the TransCanada project -- are both viable but may require a merger of interests, the Alaskan Journal of Commerce reports.

"So the key question remains: Will the two competitors merge, and when?" she said. "The competition (between both) will become inefficient and costly at some point in the near future."

The total gas production from Alaska could sustain 2 trillion cubic feet for nearly a decade by 2021. Alaska has awarded a project to TransCanada to transit natural gas from the Alaskan North Slope to the Lower 48. Alaska Gov. Sarah Palin, however, refused a portion of a federal stimulus package, raising concerns over the project.

Those concerns were echoed by several lawmakers in Alaska, who questioned the need for such a major investment amid declining energy prices and new gas markets in the Lower 48. Pearce, however, said that while the economic climate is in turmoil, long-term forecasts continued to make Alaskan gas routes important.

"Based on recent historical analysis and future projects, the Alaska natural gas pipeline would be completed in 2018 and the economics continue to be favorable," she said.

Nord Stream key for Europe

The Nord Stream gas pipeline through the Baltic Sea will satisfy the demands of more than 26 million European households, an adviser said.

Romans Baumains, an adviser for the Nord Stream gas route through the Baltic Sea, touted the project in The Baltic Course magazine, saying the project can meet as much as 25 percent of the expected growth in gas demands in the European market.

"This is enough to satisfy the energy demand of more than 26 million households, making Nord Stream an important contributor to the security of Europe's future energy supply," he wrote.

Backed by Russia, the 750-mile Nord Stream route envisions a dual-pipeline system, with the initial line expected to bring 970 billion cubic feet of natural gas to Europe each year, while the second line would double that by 2012.

The European Union put diversification of its energy-transit sector at the top of its agenda following a January quarrel between Russia and Ukraine. Europe gets about a quarter of its gas from Russia, though 80 percent of that volume travels through Soviet-era infrastructure in Ukraine.

Baumains noted that none of the major pipelines planned for the region -- including the Nabucco route to Europe -- would bring major gas shipments, around 353 billion cubic feet per year, to Europe before Nord Stream.

"At a time when Europe's future energy security is imperative, the significance of projects like Nord Stream cannot be underestimated to ensure that the (European Union) maintains its global competitiveness in a time of economic uncertainty," he concluded.

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(dgraeber@upi.com)