July 11, 2008 / 4:44 PM / 10 years ago

UPDATE 1-Russia Gazprom eyes electricity JV in Libya

(Adds background, analyst comment, details)

ARKHANGELSK, Russia, July 11 (Reuters) - Russian gas export monopoly Gazprom (GAZP.MM) is planning a joint venture in Libya to build electricity capacity, the firm said on Friday.

“We will jointly work in the electricity sphere. We will build new power generating capacity,” Gazprom spokesman Sergei Kupriyanov told journalists in the northwestern Russian city of Arkhangelsk.

He declined to name a timeframe or volumes.

The world’s largest gas producer and supplier of a quarter of Europe’s gas also said it could buy additional volumes of oil and gas from the North African state as early as this year.

“They could be swap buys or spot,” Kupriyanov added.

Earlier this week Gazprom CEO Alexei Miller travelled to Tripoli where he met with Libya’s leader Muammar Gaddafi and its top oil official Shokri Ghanem. To see the Reuters interview [ID:nL10438816].

Gazprom said it was interested in buying additional volumes of Libyan oil and gas, and also said it was eyeing a refining joint venture and a second gas pipeline going from Libya to Europe under the Mediterranean seabed.

The news sent alarm bells through the European community, where some believe the bloc relies too heavily on Russian-dominated gas.

“The gesture is certainly likely to make Europeans nervous about Russian control of European gas supplies,” Geoff Porter, an analyst at Eurasia Group in New York, said in written research.

Gazprom and Italian energy major Eni (ENI.MI) formed a strategic partnership in 2006, which allowed for energy asset swaps, including those Eni has in Libya. The two have previously said the deal also involved pipelines.

“We will discuss it (the pipeline), in principle it interests us,” Kupriyanov said.

Libya currently exports about 8 billion cubic metres (280 billion cubic feet) of natural gas per year via the Greenstream pipeline to southern Sicily.

The pipeline is owned 50/50 by Eni and Libya’s National Oil Corporation (NOC).

Russia says it seeks gas abroad to satisfy domestic demand as output in Siberia stagnates. It last year secured supply deals with ex-Soviet Central Asian states Kazakhstan, Uzbekistan and Turkmenistan, which export about 70 bcm to Russia annually.

Reporting by Denis Dyomkin, writing by Amie Ferris-Rotman

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below