Oil and Gas Pipeline Watch

By DANIEL GRAEBER, UPI Correspondent  |  May 13, 2008 at 8:48 AM
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EU, Middle East officials discuss Nabucco integration

Leaders from the European Union met with Middle Eastern officials in Brussels to finalize details of the Trans-Arab gas pipeline.

EU Energy Commissioner Andris Piebalgs and External Relations Commissioner Benita Ferrero-Waldner met Middle East officials to discuss including the Trans-Arab gas pipeline as a supplier to the EU-backed Nabucco project.

The Trans-Arab pipeline has a 353 billion cubic foot per year capacity. The pipeline runs from Egypt to Syria, with plans to connect with Turkey and Iraq by 2009.

"The Arab Gas Pipeline is set to be finalized by the end of the year, opening important possibilities as a new transport route for gas to the EU, particularly for the Nabucco project," Ferrero-Waldner said.

Piebalgs noted the Middle East region and the EU face similar challenges in the energy sector and said integrating the Nabucco project with the Trans-Arab pipeline could be a "common response" to those challenges, New Europe reported.

Piebalgs said following a meeting with Russian Energy Minister Viktor Khristenko that "We should not ask Russia to join" their South Stream project to the Nabucco network.

India examines deepwater pipeline linked to Middle East

India is looking to a deepwater pipeline project from the Middle East to avoid the political turmoil of the land-based Iran-Pakistan-India gas pipeline.

Ministers examined a $4-billion proposal for a deepwater pipeline that would stretch from Oman across the Arabian Sea to western India, The Times of India reported Monday.

Indian officials viewed the deepwater pipeline as a political and economic alternative to the overland pipeline as it averts traversing potentially volatile territory and diversifies the Indian energy supply.

The deepwater pipeline project comes on the heels of earlier success in the Black Sea's Blue Stream project and the Mardi Gras pipeline in the Gulf of Mexico.

Indian officials also viewed the deepwater pipeline as a more secure option as the risk of sabotage is mitigated.

The pipeline is scheduled for completion by 2012.

Ukraine says Russia obliged to advise Kiev on South Stream

The top foreign affairs adviser to Ukrainian President Viktor Yushchenko said Russia is legally bound to consult his country on the South Stream gas pipeline.

Oleksandr Chalyi said because the proposed South Stream project uses portions of the Ukrainian continental shelf and Russia is obligated under the law of the seas to inform the Ukrainian government of construction plans, European Voice reported Monday.

Nearly 80 percent of all natural gas exports from Asia pass through Ukraine before entering European markets.

Chalyi said this realization means "it's now time for us to think about our national interest."

He also broached Sunday the possibility of a regional consortium of Baltic and Eastern European states in the interest of securing energy flows to the region.

Ukraine and Russia have been at odds over energy matters, including rising export costs from the Russian energy giant, Gazprom.

Magellan to link Texas refineries with 80-mile pipeline

Magellan Midstream Partners Monday announced a $240-million project to build an 80-mile petroleum pipeline connecting its refining regions in Texas.

The new 150,000 barrels-per-day pipeline will connect the Port Arthur refineries to the East Houston terminal that serves as the point of origin for the company's 8,500-mile-pipeline system.

The project is backed by a 15-year agreement with Motiva Enterprises, a 50-50 venture between Shell Oil Company and Saudi Refining, Inc.

"We are pleased to continue expanding our Texas footprint to meet growing demand in that market," Magellan's chief executive officer Don Wellendorf said in a press statement.

The current Magellan pipeline system feeds three Motiva terminals in Dallas, Hearne and Waco. Magellan projects full operational capacity to commence in 2011.

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