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08 September 2007
07 September 2007
Untitled
So much to write about, too much time spent in SVO and the route therefrom to home. SVO is a shithole, so bad that it makes Heathrow Terminal 2 look like a paragon of virtue. Oh and the "otherwise" of hot air is the start of Duma election season, but I guess that deserves its own derision.
The gas wars are on the boil again (way too many mixed metaphors going on here). China has figured out that it does not have enough gas and has not bought enough or built enough pipelines and so is rationing gas and building a pipeline to China from Turkmenistan. Although Jerome a Paris is generally skeptical about pipelines, and not without reason, construction has started (or so a small bird tells me.) Oh and then there is the one about the delay in Karachaganak gas to 2012.
If you are interested in gas, and like being warm in winter and cool in summer then you will have seen a take on these graphs below at some time. The first shows GAZP's own production. The bits you should worry about are above the yellow line. Not that they don't exist its just that they may take some time to arrive (see previous thoughts on Shtockman).
The graph below shows the total supply of gas required to meet forecast demand. If you can get over the fact that by 2015 the gap between known GAZP supply and expected GAZP supply is 100bcm p.a. out of a total of 550bcm p.a. and why not, people continued to buy pools of AAA rated worthless mortgages way after they knew that they were worthless. So with that intellectual honesty established; the next concern is whether Central Asian (shitty nomenclature) is actually a. going to produce all the gas forecast (Kazakhstan and Turkmenistan) and b, whether they are going to actually send it via Russia to feed Russia and Europe (once the gas enters the pipeline its fungible whathever fiction RosUkrEnergo maintains.)
Everyone wants a piece of Trashcanistan's gas and ever since the great Turkmenbashi shuffled off to wherever Turkmenbashi's shuffle, the Russians, Chinese and Americans have all been telling the President with the unfeasibly long name to send his gas their way. Logically it should go through Russia - as a pipeline exists, but the Chinese are quite keen on it and are therefore building one. None of JaP's thinking about thinking about for them - the logic is easy; lots of people need lots of energy. Secure it early and don't worry about reversions to the mean (you measily analysts know what I mean).
The Americans, as a proxy for Europe (that worked well last time), want to send it under the Caspian and thence along the Freedom Corridor i.e. not Russia or Iran in to Europe or Turkey. This option is currently coming 6th of the available three.
The last of my pretty pictures shows how much gas has to come from independents. I chose this particular description because it highlights the supply sum; Gazprom production plus expected Central Asian supply + a known/expected independent production (after price liberlization) plus another number (the source of which is not known) equal demand. Magic - here's my personal version of this equation; amount spent = amount earnt plus the amount I would like to earn.
Some of these numbers are getting a little dated (2005 actuals) but nothing has changed to make me worry that that my bets will be wrong, including the likelihood of a very nasty earnings season for banks.
The gas wars are on the boil again (way too many mixed metaphors going on here). China has figured out that it does not have enough gas and has not bought enough or built enough pipelines and so is rationing gas and building a pipeline to China from Turkmenistan. Although Jerome a Paris is generally skeptical about pipelines, and not without reason, construction has started (or so a small bird tells me.) Oh and then there is the one about the delay in Karachaganak gas to 2012.
If you are interested in gas, and like being warm in winter and cool in summer then you will have seen a take on these graphs below at some time. The first shows GAZP's own production. The bits you should worry about are above the yellow line. Not that they don't exist its just that they may take some time to arrive (see previous thoughts on Shtockman).
The graph below shows the total supply of gas required to meet forecast demand. If you can get over the fact that by 2015 the gap between known GAZP supply and expected GAZP supply is 100bcm p.a. out of a total of 550bcm p.a. and why not, people continued to buy pools of AAA rated worthless mortgages way after they knew that they were worthless. So with that intellectual honesty established; the next concern is whether Central Asian (shitty nomenclature) is actually a. going to produce all the gas forecast (Kazakhstan and Turkmenistan) and b, whether they are going to actually send it via Russia to feed Russia and Europe (once the gas enters the pipeline its fungible whathever fiction RosUkrEnergo maintains.)Everyone wants a piece of Trashcanistan's gas and ever since the great Turkmenbashi shuffled off to wherever Turkmenbashi's shuffle, the Russians, Chinese and Americans have all been telling the President with the unfeasibly long name to send his gas their way. Logically it should go through Russia - as a pipeline exists, but the Chinese are quite keen on it and are therefore building one. None of JaP's thinking about thinking about for them - the logic is easy; lots of people need lots of energy. Secure it early and don't worry about reversions to the mean (you measily analysts know what I mean).
The Americans, as a proxy for Europe (that worked well last time), want to send it under the Caspian and thence along the Freedom Corridor i.e. not Russia or Iran in to Europe or Turkey. This option is currently coming 6th of the available three.
The last of my pretty pictures shows how much gas has to come from independents. I chose this particular description because it highlights the supply sum; Gazprom production plus expected Central Asian supply + a known/expected independent production (after price liberlization) plus another number (the source of which is not known) equal demand. Magic - here's my personal version of this equation; amount spent = amount earnt plus the amount I would like to earn.
Some of these numbers are getting a little dated (2005 actuals) but nothing has changed to make me worry that that my bets will be wrong, including the likelihood of a very nasty earnings season for banks.
China has enacted a new industry policy on natural gas use to address the supply shortage and optimize usage, the nation's planning agency said yesterday. The guideline says residential gas use is a top priority, while usage in petrochemical plants is discouraged, the National Development and Reform Commission said on its Website. The policy, described by the NDRC as of "strategic importance," became effective on Aug. 30 after approval by the State Council. New methanol projects that use gas as a base will be barred. Methanol, which can also be derived from coal or crude oil, is an industrial chemical and a fuel that can be mixed with gasoline and diesel to cut pollution. The use of natural gas in other petrochemical projects and power-generation plants will also be limited or outlawed. For example, gas-fired power plants will be banned in certain coal-rich regions. The guideline said urban residential gas use is the most favored option. "We have to ensure gas will be first used in the residential sector," the planning body said. "We should consider social benefits, environmental benefits and economic benefits" while deciding where the gas resources should be used first. The NDRC said gas use should be well planned for better conservation and higher usage. Existing gas-based petrochemical projects, especially fertilizers, will remain in operation. Those approved and under-construction projects, which have signed long-term gas-purchase contracts, also won't be affected, the NDRC said. China wants cleaner-burning natural gas to account for 5.3 percent of total primary energy consumption by 2010, up from 2.8 percent in 2005. But supply may not catch up with the strong demand, typically in booming coastal regions. Several major gas-transport projects have lately been announced or launched. Sinopec Corp on Friday started building a 1,702-kilometer pipeline to transmit gas from the Puguang field in Sichuan Province to Shanghai. China National Petroleum Corp announced early last week the route for a mega cross-country gas pipeline, at more than 7,000 kilometers long, to transport Turkmenistan gas via far northwestern Xinjiang Uygur Autonomous Region to Shanghai in the east and Guangzhou in the s [From Новости Neftegaz.RU | Policy on natural gas streamlined in China]
When In Rome
I had failed to spot this little tidbit. Any clues in here as to why RenCap are off to Africa?
Mr Misamore and two other Yukos executives, David Godfrey and Daniel Feldman, told the Financial Times that the group of investors behind the Monte Valle bid included a representative of Moscow investment bank Renaissance Capital and another from US hedge fund VR Capital. They claimed that two members of the group, Renaissance Capital vice-president Bob Foresman and VR Capital president Richard Deitz, had called to ask them to unwind the legal attachments protecting the assets from the bankruptcy sale, saying that in return, state-run Rosneft would drop its creditors’ claims on the Dutch holding. Mr Feldman said Mr Foresman had called him two days before the sale, “to know if there was a way to make a deal that would provide them with comfort”. “He called the day before the auction and said you have to understand if we can work out a compromise you can come back and work in Russia.” Mr Feldman left Russia in February, fearing arrest. The claims could not be fully verified: Mr Foresman declined to comment. Mr Deitz said he did not recall all the details of his conversation with Mr Godfrey. Mr Deitz said he had “never in his life” met with Rosneft, while Monte Valle owner Stephen Lynch also said he had no talks with Rosneft or the authorities prior to the sale. The allegations are the latest twist in a bankruptcy process marred from the outset by claims it has been rigged in favour of Rosneft. [From FT.com / Companies / Energy Utilities Mining - Investors made backdoor Yukos approach]
06 September 2007
Ways to Waste Your Time
1. Fly via the 3rd World Airport otherwise known as Sheremeytevo and then drive in to the center of Moscow - approx 2 hours 30 minutes*
2. Work in a multi-story building with too few lifts and large numbers of (principally) girls who fill in the gaps between smoking with a bit of work
3. Drive in Moscow between the hours of 00.01 and 23.59
* Timing does not include retrieval of bags or passport control queues. Though passport queues are redundant when carrying a small child - oh what a joy walking to the front of a 40 minute queue with small child. Any suggestions as to where I can acquire a lifelike blow-up baby for queue-jumping much appreciated.