Unconventional gas in Europe: Frack to the future

The Economist

SHALE gas and oil are propelling America to energy self-sufficiency and giving its economy a handy boost. Europe’s shale-gas deposits are said almost to match those across the Atlantic (see map). Will the old continent soon enjoy the same benefits?

The mismatch between the hope and reality for European shale gas was neatly summarised by a deal sealed on January 24th that will allow Shell to probe Ukraine for unconventional gas. Ukrainian politicians talked of a $10 billion investment. Shell took a more cautious line. The firm certainly hopes to find plenty of gas in eastern Ukraine. But it will first do some seismic testing and sink 15 test wells. If the results are disappointing it could, like ExxonMobil in Poland, walk away.

It is too early to tell whether Europe’s shale beds will really prove as bountiful as America’s. Only a handful of test wells have been sunk. Exxon may have quit Poland, the country where exploration has gone furthest, but other firms are having more joy. Determining which countries might enjoy a bonanza of cheap gas is highly speculative, a recent report by Deutsche Bank points out: many things are in flux, including extraction technologies and production rates.

Turkey sees promise in pivoting north

Black Sea Countries and transportation routes on the map

Catherine Stupp    Christian Science Monitor

With its attempts to join the EU stalled and its leadership role in the Middle East marred by Syria's conflict, Turkey is turning its attention to a less tumultuous border – the Black Sea.

Istanbul, Turkey - Its protracted bid to join the European Union remains stalled and its "zero problems" policy in the Middle East is cracking over support for Syria's opposition. But one foreign policy front retains promise for Turkey: the Black Sea. 

Nowhere is it more evident than the busy industrial city of Trabzon in northeastern Turkey, a regional trade hub because of its location on roads that connect it to both Istanbul and other cities to the east. The cobblestone streets of the city center are bustling with buses and private cars carrying passengers to Georgia, only 125 miles to the northeast, as well as trucks shipping goods across the region via the highway that cuts through the city.

If plans for a highway connecting the 12 countries bordering the Black Sea go forward, Trabzon's growth – and Turkey's growing stance as a regional leader – is poised to surge.

Turkey’s Black Sea coast, far from its tumultuous southern border, offers a promising contrast its more troubled efforts to join the EU and to expand networks in the Middle East. Ankara has emerged as the dominant initiator of regional cooperation, institutionalized by the Black Sea Economic Cooperation (BSEC), which was founded on the heels of the collapse of the Soviet Union.

Filling the Soviet vacuum

Although Turkey was one of 10 founding members, it played a leading role in BSEC's establishment, and the organization's permanent headquarters is still located in Istanbul.

Turkey Approves Russian Gas Plan

Jacob Gronholt - PEDERSEN       THE WALL STREET JOURNAL

MOSCOW—Russia secured approval from Turkey on Wednesday to build the South Stream gas pipeline across the Black Sea, removing the last major obstacle to proceed with a project that could increase Europe's dependence on Russian natural-gas supplies.

The move heats up the battle between Russia and the European Union over competing pipelines, especially the European Union-backed Nabucco project, and increases pressure on Ukraine to give Moscow control of its pipeline system.

Turkey's approval, given by Energy Minister Taner Tildiz during talks with Russian Prime Minister Vladimir Putin in Moscow on Wednesday, had been a stumbling point for Russia to proceed with the offshore part of the South Stream project.

Russian state gas giant OAO Gazprom ships most of its gas exports to Europe via Ukraine, but supply disruptions in recent years due to pricing disagreements between the two countries have led Russia to seek to bypass Ukraine and promote new pipelines such as South Stream.