Arctic Oil/Gas Neg

With gas production dropping in the U.S. Russia sees the US market as a key focal point of natural gas exports in the future.

Alexy, Chairman of Gazprom , Gazprom, invites you to tap Russia's natural gas 6/27/08, Commodity Online http://www.commodityonline.com/news/globalview/Gazprom-invites-you-to-tap-Russias-natural-gas-9977-3.html

Global challenges require global efforts for their resolution. For this reason, the sphere of our interests in not limited to the European continent. It is well known that gas production has been steadily dropping in the United States in recent years (by more than 30 billion cubic meter between 2001 and 2006), while Russia over the same period has been able to boost production by 70 billion cubic meters. Gazprom has unique experience, know-how, and modern technologies, and is the world’s most advanced company in the field of gas transmission via high-pressure gas pipelines. For this reason, for example, we are also interested in taking part in such major projects as the construction of a gas pipeline from Alaska. We have already made a related proposal to our partners –ConocoPhillips and BP. Gazprom hopes to serve the North American market from 2014 with liquefied natural gas from its proposed Shtokman project off Russia’s north coast. “We are currently assessing several options of accessing the North American market,” he said, adding that Gazprom had received “many interesting proposals” from Canadian companies. He also confirmed that Gazprom was interested in the proposed Alaska gas pipeline. In the coming years Gazprom will be not just a major company in the world, but the most influential in the energy business,” adding that its target was to reach a market capitalisation of $1,000bn.

US Key – Russia is too competitive to be lucrative for Russia

former executive with Chevron and Mobil, is managing director and chairman of F C Fee International, Inc, an energy risk management consultancy based in London, Russian And Iranian Gas And Future US Energy Security” IRAN/RUSSIA, VOL. XLVI No 37, 15-September-2003, http://www.mees.com/postedarticles/oped/a46n37d01.htm

Russian Gas Exports To The US

The US, faced with declining domestic gas production and rising gas demand for gas-fired power plants, will soon need to accelerate its importation of LNG. The US government, having recognized the need for action to protect and ensure US energy security, has already signaled its interest in possible Russian gas exports to both the US east and west coasts (Gulf of Mexico coast not being feasible for Russian exports). The Russian government, likewise, has begun to recognize the US as a potentially lucrative new export gas market. In 2003, the Russian government decided to enter for the first time the LNG export market, and to refocus its export gas strategy towards the US as a high priority. Moscow now sees the US gas market as highly lucrative as opposed to the European market which is mature and highly competitive, the latter especially true as a result of recent EU gas market liberalization. Nevertheless, Europe will continue to be of great importance for Moscow as proof of Russia maintaining its reputation as a reliable long-term supplier of pipeline gas.

AT: Oil Outweighs

Natural gas is key to Russia’s economy – it’s more sustainable than oil

Hill 2

(Fiona, Senior Fellow at the Brookings Institute, “Russia: The 21st Century's Energy Superpower?”, Spring, http://www.brookings.edu/articles/2002/spring_russia_hill.aspx

Last fall and winter, as tensions increased in the Middle East and as speculation grew that the Bush administration might extend the war on terrorism into Iraq, the world's news media began trumpeting Russia as a new power in global energy markets. In the Washington Post in December, David Ignatius claimed that Moscow is "on its way to becoming the next Houston—the global capital of energy." By January, Russia's President Putin had been hailed by a Canadian paper as "the world's new oil Czar," and the Russian media were replete with commentary on Russia's role as the power broker in world energy markets. The heightened media attention has raised the possibility that Russia could take on OPEC and help shift global oil supply away from the Middle East and Persian Gulf. Could Russia be poised to become an energy superpower in the 21st century? The short answer is yes, but not in the near future—and not in oil. Russia may well break into some global energy markets as an alternative supplier to unstable states in the Persian Gulf. But Russia's energy future is in natural gas. As the next decade unfolds, continued crises in the Middle East and growing concern about pollution and global climate change will inevitably focus attention on Russia's vast reserves of cheaper, cleaner natural gas. Russia's success in international gas markets, however, is not a given. It will depend on major increases in production, serious investments—both foreign and domestic—in infrastructure, and the development of fully functioning gas markets in Asia. Petrodollars and the Russian Economy Gas and oil have been the mainstay of the Soviet and now Russian economy for decades. Energy accounts for about half of Russian export earnings. According to Brookings economist Clifford Gaddy, "Every dollar's increase in the price of a barrel of petroleum translates into roughly $1.5-$2.0 billion of additional yearly export revenues." During 1999-2000, energy exports accounted for some 90 percent of Russia's growth in GDP. Thanks to high oil prices, at the end of 2001 the economy had enjoyed its best three-year performance since 1966-69. Russia's oil industry slumped badly during the 1990s. As the economy contracted sharply from 1990 to 1995, domestic demand for oil fell more than 40 percent, causing a glut on the domestic market. Capacity limits in the country's pipeline system kept lucrative oil exports down. Between 1988 and 1998, Russian oil production fell almost in half—from 11 million to around 6 million barrels a day (mbd). Drilling fell off sharply, as did investment. International investors exploring the Russian oil industry were scared away by the uncertain business climate. Russian oil seemed like a money-loser. Russia's August 1998 financial crisis, the devaluation of the ruble, and the subsequent—although entirely unrelated—rise in oil prices revived the industry. The devaluation drastically lowered input costs for Russian energy producers, while sharply higher oil prices boosted revenues even without new investments or production increases. In 2001, oil companies boosted production and expanded their international reach. Russian companies are drilling for oil in Algeria, Sudan, and Libya. In 2000, LUKoil acquired a chain of gas stations along a stretch of the American East Coast and planned to strengthen its position in the United States by refining crude oil. In Eastern Europe, LUKoil acquired refineries in Ukraine, Romania, and Bulgaria; and YUKOS purchased a major stake in Transpetrol, a Slovak crude pipeline operator. New regulatory instruments and fixed tax rates implemented by the Putin government in 2001 greatly improved the investment climate for international operators. In October 2001, Exxon Mobil announced a five-year $4 billion commitment—Russia's largest single foreign investment to date—to its projects in Sakhalin, Russia's energy-rich island in the North Pacific. By the end of 2001, Russia was becoming a real international energy player. New stretches of export pipelines had been completed, and a new Russian oil terminal was operating on the Gulf of Finland. Russia concluded an ambitious agreement with the European Union on long-term energy cooperation that would increase oil exports to its neighbor. The European Union already buys more than half of Russia's total oil exports, accounting for some 16 percent of its oil consumption. Limits on Russian Oil But for all its recent success, Russia will never displace OPEC in world oil markets. Over the long term, it cannot match OPEC's oil reserves. In oil production, Russia ranks third behind Saudi Arabia and the United States, at just over 7 mbd. In exports, it ranks second, at about 4 mbd, behind Saudi Arabia with close to 7 mbd. But it ranks seventh in proven oil reserves, with only 5 percent—as against the OPEC countries' collective 77 percent. Because of OPEC's huge reserve base the International Energy Agency predicts that increases in world production during 2010-20 will primarily be from Middle East OPEC countries. One sign of Russia's reserve limits is that its recent oil industry boom was caused by increases in oil prices, not production. In fact, Russia has yet to restore production to the 11 mbd peak it reached before the collapse of the USSR. And high production costs, together with its limited reserves, will keep Russia from increasing its production capacity far beyond that point. It costs Saudi Arabia a little more than $5 to produce a barrel of oil; it costs Russia, on average, twice that. If global recession and depressed world demand send oil prices down again, Russian oil companies could easily slide back into the troubles of the 1990s. For Russia, oil is too volatile a commodity on which to bet its entire future. Turning Up the Gas Will Russia fare any better with natural gas? Many in Russia's energy complex think so, and many Russian oil companies are expanding their activities in the gas sector. Russia's gas reserves far exceed those of any other country. Indeed, Russia is to natural gas what Saudi Arabia is to oil. With 32 percent of proven world reserves, Russia far outranks Iran (15 percent), Qatar (7 percent), Saudi Arabia and the UAE (4 percent), and the United States and Algeria (3 percent). Single-handedly, Gazprom, Russia's giant gas company, holds a quarter of all world gas reserves, controls 90 percent of Russian output, and is Russia's largest earner of hard currency. Its tax payments account for around 25 percent of total federal government tax revenues. Although oil remains the dominant global fuel source, natural gas is increasing in importance. It now accounts for about 23 percent of world energy consumption and will soon displace coal (at just over 24 percent) in world markets. Increased use of liquefied natural gas and improvements in pipeline technology have transformed gas from a local commodity into an international business.

Relations Mod

Gas exports key to relations

America.gov 5

Russia, United States Seek To Intensify Energy Cooperation,” 2/24/05 http://www.america.gov/st/washfile-english/2005/February/20050224142819SAikceinawz0.4095423.html

Russia, United States Seek To Intensify Energy Cooperation Pipeline system, liquefied natural gas viewed as areas of interest The United States and Russia have pledged to intensify their cooperation on removing barriers to energy trade and investment and other issues through the existing energy dialogue. President Bush and President Putin said in a joint statement issued after their February 24 meeting in Bratislava, the Slovak Republic, that they want U.S. and Russian officials to develop recommendations and specific proposals in areas of energy security, transparency, commercial energy partnerships and energy-related environmental problems. The statement cited support for the expansion of the pipeline system and liquefied natural gas capacity in Russia with a view that such enhancements, together with a more transparent business and investment environment, will help increase Russian oil and gas exports to the U.S. and other markets. At a news conference following the meeting Putin said: “In the years 2010, 2011, a large amount of liquefied natural gas can be supplied from Russia to the United States.” Several energy projects should be initiated no later than 2008, the statement said. According to the U.S. Energy Department's Energy Information Administration, Russia has the world's largest natural gas reserves and the eighth-largest reserve of proven crude oil. The original 2002 joint statement of the two leaders in which they launched the U.S.-Russia Energy Dialogue can be viewed at http://www.whitehouse.gov/news/releases/2002/05/20020524-8.html. Following is the text of the 2005 joint statement: THE WHITE HOUSE Office of the Press Secretary (Bratislava, Slovak Republic) February 24, 2005 Joint statement by President George W. Bush and President Vladimir V. Putin U.S.-RUSSIAN ENERGY COOPERATION Cooperation on energy issues remains an area of great promise for U.S.-Russian relations.  We will work further to realize the vision for our energy cooperation in all aspects described in our statement in May 2002, including through the mechanisms of the Commercial Energy Dialogue and the Energy Working Group.  Accordingly, we have instructed our ministers to continue their energy dialogue, concentrating on ways to enhance energy security, diversify energy supplies, improve the transparency of the business and investment environment, reduce obstacles to increased commercial energy partnerships, and develop resources in an environmentally safe manner. We call upon our Ministers of Energy and Commerce to develop recommendations, which we can support at one of our upcoming meetings, on how to further intensify and develop our energy dialogue.  Those recommendations will focus on identifying barriers to energy trade and investment, promoting initiatives to remove them on the basis of predictability, fairness and law, and suggesting specific proposals for cooperating in developing energy trade and investment. We will promote the creation of transparent tax, legal, regulatory, and contractual conditions for our companies' cooperation, and support Russia's pipeline system development, which will create the preconditions for increasing deliveries of oil and gas export, including to the U.S. market. We are interested in increasing U.S. commercial investment in Russia, so as to create additional capacity for liquefied natural gas (LNG) in Russia, and also with the aim of increasing LNG exports to U.S. markets.  We would welcome increased Russian oil exports to the world market and an increased presence of imports from Russia in the United States.  We would also welcome expanding mutual investments in the energy sectors of both countries.

Strong US- Russian relations are necessary to access pretty much ever major impact imaginable

Nixon Center 3

Advancing American Interests and the U.S.-Russian Relationship: INTERIM REPORT,” SEPTEMBER 2K3 HTTP://WWW.NIXONCENTER.ORG/PUBLICATIONS/MONOGRAPHS/FR.HTM

The proper starting point in thinking about American national interests and Russia—or any other country—is the candid question: why does Russia matter?  How can Russia affect vital American interests and how much should the United States care about Russia?  Where does it rank in the hierarchy of American national interests?  As the Report of the Commission on American National Interests (2000) concluded, Russia ranks among the few countries whose actions powerfully affect American vital interests.  Why? § First, Russia is a very large country linking several strategically important regions.  By virtue of its size and location, Russia is a key player in Europe as well as the Middle East and Central, South and East Asia.  Accordingly, Moscow can substantially contribute to, or detract from, U.S. efforts to deal with such urgent challenges as North Korea and Iran, as well as important longer term problems like Iraq and Afghanistan.  In addition, Russia shares the world’s longest land border with China, an emerging great power that can have a major impact on both U.S. and Russian interests.  The bottom line is that notwithstanding its significant loss of power after the end of the Cold War, Moscow’s geopolitical weight still exceeds that of London or Paris. § Second, as a result of its Soviet legacy, Russia has relationships with and information about countries that remain comparatively inaccessible to the American government, in the Middle East, Central Asia and elsewhere.  Russian intelligence and/or leverage in these areas could significantly aid the United States in its efforts to deal with current, emerging and still unforeseen strategic challenges, including in the war on terrorism. § Third, today and for the foreseeable future Russia’s nuclear arsenal will be capable of inflicting vast damage on the United States.  Fortunately, the likelihood of such scenarios has declined dramatically since the Cold War.  But today and as far as any eye can see the U.S. will have an enduring vital interest in these weapons not being used against America or our allies. § Fourth, reliable Russian stewardship and control of the largest arsenal of nuclear warheads and stockpile of nuclear materials from which nuclear weapons could be made is essential in combating the threat of “loose nukes.”  The United States has a vital interest in effective Russian programs to prevent weapons being stolen by criminals, sold to terrorists and used to kill Americans. § Fifth, Russian stockpiles, technologies and knowledge for creating biological and chemical weapons make cooperation with Moscow very important to U.S. efforts to prevent proliferation of these weapons.  Working with Russia may similarly help to prevent states hostile to the United States from obtaining sophisticated conventional weapons systems, such as missiles and submarines. § Sixth, as the world’s largest producer and exporter of hydrocarbons (oil and gas), Russia offers America an opportunity to diversify and increase supplies of non-OPEC, non-Mid-Eastern energy. § Seventh, as a veto-wielding permanent member of the United Nations Security Council, Russia can substantially ease, or complicate, American attempts to work through the UN and other international institutions to advance other vital and extremely important U.S. interests.  In a world in which many are already concerned about the use of U.S. power, this can have a real impact on America’s success at providing global leadership.  More broadly, a close U.S.-Russian relationship can limit other states’ behavior by effectively eliminating Moscow as a potential source of political support.

Gas Key to Relations

U.S.-Russian investment cooperation over natural gas and energy issues is critical to boosting overall relations

Johnson 5

David, research director at the Center for Defense Information, "RUSSIAN FOREIGN MINISTER COMMENTS ON ATTEMPTS TO RESTORE `ENEMY IMAGE" Jan 29 05

http://www.cdi.org/russia/johnson/9040-3.cfm

MOSCOW, January 29 (RIA Novosti) -Russia has been lately witnessing a lot of outside criticism which distorts the actual state of affairs in the country and aims to set Russia at odds with the USA, Russian Foreign Minister Sergei Lavrov told the Russian-American Business Cooperation Council.

The highlights of the Minister's speech at the Council can be seen at the Russian Foreign Ministry's web site. "We have been lately hearing voices of those who urge the US business community to refrain from investing in Russia, citing unfavorable investment climate and an alleged `clamp down on democracy` in our country", Lavrov said. According to him, he has repeatedly pointed out that Russia is open for criticism in case the latter "stems from bona fide intentions and an honest interest in developing fair partnership". "Unfortunately, such is not always the case. Every now and then we face criticism that does not only distort the actual state of affairs but also pursues an ill-concealed aim to damage the Russian-US relations and restore, in one way or another, the `enemy image`. Apparently, this approach is totally inadmissible," the Russian Foreign Ministry said He pointed to a new trend in the Russian-US cooperation - a notable growth of Russian investment in the US economy and illustrated his words with a number of recent transactions including acquisition by Russia's Severstal of US fifth steel producer RJ Industries, and Lukoil's purchase of Conoco Philips' chain of gas stations in New Jersey and Pennsylvania. As a result, Lukoil now owns one of the biggest chains of gas stations in North America. "The overall volume of Russian investment in the USA is currently about $1 billion and is commensurate with the level of American investment in Russia. In a nutshell, our investment cooperation has been steadily becoming a two-way street," Sergei Lavrov pointed out. In his opinion, "the Russian-US cooperation in the energy sector holds the most potential, and not only in terms of bilateral relations." According to him, the Russian-US cooperation in this vital area can substantially strengthen the world's energy security and stabilize supply of energy resources on a global scale, including an increased share of Russian energy resources in the North American market (from 2 to 10 percent). "Among other things, the Russian side is interested in adjusting the terms of competition on the world oil market, primarily those set by the Arab countries," the Russian Foreign Minister said. The potential projects in the energy sector include construction of a pipeline linking Western Siberia with the Barents Sea, expansion of the Russian facilities for liquefying natural gas with the aim of boosting natural gas supplies to North America, and further R&D efforts in exploring new sources of energy, such as hydrogen..

Econ/Low Oil Prices t/c

Low oil prices and underperforming economy drive away investment

Callow 12 Lin Callow, LTLC Consulting, “Oil and Gas Exploration & Development Activity Forecast: Canadian Beaufort Sea 2012-2027” prepared for Beaufort Regional Enviornmental Assessment Aboriginal Affairs and Northern Development Canada April 2012 http://www.beaufortrea.ca/wp-content/uploads/2012/04/Beaufort-Sea-OG-activity-forecast-2012-2017.pdf

Although, current oil prices appear to be moving towards historical highs, global economic instability threatens to reverse this trend. This combined with high costs and industry uncertainty, as to how equivalency to the NEB Same Season Relief Well Policy can be achieved, may result in shifts in corporate exploration and development expenditures away from the Beaufort Sea. However, a sustained global economic recovery with accompanying increases in oil prices would encourage exploration and development.

Directory: file -> view
view -> Western Europe after wwii
view -> Author study: paul fleischman
view -> Qpa1 7ela study Guide
view -> November 1970 Approximately 150,000-500,000 deaths Bhola Cyclone Bangladesh
view -> Grade Level: 6 Unit of Study: Caribbean glce
view -> Citation: Duffield, Katy
view -> Table of Contents Lesson #
view -> Chinese Wind Energy Disad
view -> Essay writing guidelines

Download 2.21 Mb.

Share with your friends: