Chevron to eastern Europe: We might be able to help you with that fracking Russian-dependence problem
posted at 8:41 pm on July 25, 2013 by Erika Johnsen
Despite their misbegotten and expensive quest to forcibly restructure their energy sectors with subsidies and special treatment for what they’ve decided are so-called green energies (and they’ve got the higher electricity prices to prove it), plenty of European countries — including Germany and France, the eurozone’s two largest economies — have roundly and robustly refused to encourage energy companies to institute the practice of drilling for oil-and-gas supplies via hydraulic fracturing. Now, of course, that the evidence is mounting that both natural gas and fracking are even cleaner and safer than everyone first thought, Europe is years behind the United States in terms of infrastructure — and while Europe might not have the quite the available supply of locked-up natural gas as the United States, there’s only one way to find out.
Plenty of countries are still reluctant to do so, but Chevron is wondering if they can’t convince a few of them to let them take another crack at it. Via Bloomberg:
Chevron Corp. (CVX) is betting it can win over eastern Europeans with the idea of energy independence even after dry wells and government delays led Exxon Mobil Corp. and Talisman Energy Inc. (TLM) to scrap efforts to tap natural gas deposits in Polish shale.
Bringing shale drilling to Europe from North America promises to help the region ease years of dependence on Russian fuel and hurts the Kremlin’s ambition to secure the country’s future as an energy superpower. Use of hydraulic fracturing, or fracking, upended the U.S. gas industry, which overtook Russia as the biggest producer, driving prices to a decade-low.
“This resource could certainly enhance energy security within Europe and also bring enormous economic benefits,” said Ian MacDonald, Chevron vice president for Europe, Eurasia and the Middle East. “Chevron believes that upon learning how these hydrocarbon resources can be explored for and developed safely, the governments and citizens of central Europe will be supportive.”…
Chevron has leased or licensed for exploration 5.6 million acres in Poland, Ukraine, Romania and Bulgaria, an area the size of New Jersey. Its joint venture in Lithuania has a license for about 600,000 acres, and Chevron is applying for another 450,000. In Ukraine alone it agreed to spend $400 million on exploration. Royal Dutch Shell Plc (RDSA) won rights to explore for shale gas in the Yuzivska field in Ukraine’s Kharkiv region in May 2012, and signed a production sharing agreement in January.
Breaking up Russia’s stronghold over gas supplies and their subsequent political influence in parts of Europe is one of the major geopolitical arguments in favor of the United States finally allowing companies to export more natural gas, as well — let’s get this fracking party started already, shall we?