Access of EU to oil and gas in 2020

10Jul
2001

Meno Grouvel, the head of the exploration/production sector for Europe and Central Asia at TotalfinaElf spoke on the subject of EU access to oil and gas in 2020 by describing two projets currently being developed by his group.

These are Girassol in the case of oil in deep offshore waters (1350 m ) off the coast of Angola and Shtokman in the case of gas, also in offshore waters (at a depth of 330 m ) 550 km to the NE of Murmansk.

According to TotalFinaElf, apart from the enormous technical and financial challenges that the companies are ready to meet, Europe faces no oil supply problems for as long as consumers are prepared to pay the price.

Gas supplies for Europe are rather more problematical. First of all, the major role that Russia has to play in the medium and long term has to be recognised, in the knowledge that the other potential supplier countries will not be able to meet the increase in European demand.

The question is therefore that of determining whether Russia will be capable of developing its reserves to meet European demand, bearing in mind the fact that Russia itself – and not the European Union – is the main customer for Russian gas and that Russia has other foreign customers outside Europe.

Over the next 20 years, it is expected that Russia will develop a similar volume of reserves to those it is currently exploiting. In order to do this, other Russian actors in addition to Gazprom will have to enter the exploration-production-transport sectors in Russia in great numbers.

The country will thus have to adapt its economic and legal climate in response to these new challenges and seek out the bases for an agreement with the European Union that will enable the latter to provide strong support.

Pointing to the case of the Shtokman project, Meno Grouvel highlighted the risks resulting from the deregulation process during the transitional phase. In particular, the fact that it is increasingly difficult to finance the development of a large gas field in the absence of a long-term supply contract.