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Energy Blast – June 30, 2008

BP’s chief executive has warned that the era of “cheap energy” is over. The Prime Ministers of Russia and Ukraine met over the weekend and will continue to seek an agreement on what Vladimir Putin described as “excessively politicized” natural-gas prices. Both sides currently appear optimistic, with Putin praising Ukraine for making its gas payments on time this year, although other stories focus on Russia’s negative rhetoric against Ukraine regarding Nato. Today is the last working day of the state energy monopoly Unified Energy Systems. Former Prime Minister Viktor Zubkov has made his debut at Gazprom. Engineering company Power Machines has signed a $171 million contract to supply thermal equipment for a nuclear power plant. Gazprom’s planned skyscraper will have a “green fur coat”. Sibir Energy reported triple full year pre-tax profits and “hailed the imminent resolution of a dispute with Gazprom”. A handful of big new fields due to come on line in Russia in the next few years “will barely make up for rapidly declining production at existing fields in western Siberia.” Rosneft is not interested in buying a stake in rival TNK-BP. Italy’s Saipem and Nord Stream have signed a €1 billion contract for laying the Nord Stream gas pipeline.