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OIL AND GAS
Some European gas consumers are too dependent on Ukraine, Russia says
by Daniel J. Graeber
Moscow (UPI) May 12, 2013


Gas from controversial shale program in U.K. may be ready for grid
London (UPI) May 12, 2013 - British shale gas explorer Cuadrilla could start testing delivery rates through the nation's transmission system, Chief Executive Francis Egan said.

Egan said gas from shale deposits in the country could start flowing through the nation's transmission system by the end of next year, albeit at low volumes.

"After the initial flow test period, which is up to 90 days, if the flow rates look good then we would want to tie the well into the gas transmission system and flow it for a longer period to assess the flow rate over 18 to 24 months," he said Sunday.

The company was the target of major demonstrations last summer when its work in the southern village of Balcombe was viewed as a prelude to hydraulic fracturing, known also as fracking.

In January, Cuadrilla sent a letter to village residents saying it was applying for an extension to a license for exploration in the area but found natural fractures in Balcombe's shale that may prohibit fracking.

In March, the company said it believes there are 200 trillion cubic feet of shale natural gas in the Bowland basin in Lancashire.

A gas payment row between Russian energy company Gazprom and Ukraine exposes regional consumers to increased risks, Russia's deputy energy minister said.

Russian Deputy Energy Minister Anatoly Yanovski said Russia could send more natural gas through pipelines that avoid geopolitically sensitive territory in Ukraine, like the Nord Stream pipeline through the Baltic Sea. Some Gazprom customers, he said, have few other options, however.

"Countries that have no alternative supply [channels] other than the Ukrainian gas transport system are most at risk," he said Monday.

Yanovski said Bulgaria, along with Bosnia and Herzegovina, were among those with the most risk.

European consumers get about a quarter of their gas needs meet by Russia, though most of that supply runs through the Soviet-era transit network in Ukraine.

Yanovski says Ukraine has few other options apart from paying its mounting debt to Gazprom. The Russian energy company in 2009 cut gas supplies through Ukraine in response to a similar gas row.

Gazprom in April sent its Ukrainian counterpart Naftogaz a bill for more than $11 billion for taking on less gas than contracted in 2013.

Swedish energy company can't upgrade reserve potential at North Sea field
Stockholm, Sweden (UPI) May 12, 2013 - Swedish energy company Lundin Petroleum said Monday it doesn't expect much more oil or gas from its Edvard Grieg field despite more testing.

The company said it finished testing well 16/1-18 at the field in the Norwegian waters of the North Sea. It found mostly oil through a combined 200 feet thick reservoir, which tested at a preliminary rate of 800 barrels of oil per day.

Lundin President Ashley Heppenstall said he was optimistic in that the area tested was assumed to have a low yield, but was generally disappointed with the overall results.

"At this stage I expect the impact on Edvard Grieg resources to be neutral with upside remaining from the conglomeratic reservoir," he said in a statement Monday.

Edvard Grieg was discovered in 2007.

Lundin says first production from the field is expected in late 2015. Peak production is anticipated at 90,000 barrels of oil and 53 million cubic feet of natural gas per day.

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