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Major investment could be required by European Union (EU) gas utilities because ...

Major investment could be required by European Union (EU) gas utilities because of a new EU regulation insisting that member states have sufficient storage capacity to deal with supply crises such as the Russia and Ukraine disputes in 2008 and 2009, writes Keith Nuthall. A new regulation negotiated between the European Parliament and the EU Council of Ministers orders gas companies to have supplies to meet 30 days of exceptionally high demand for households and, if national governments choose, additional protected customers - such as small-and-medium-sized businesses and essential social services consuming less than 20% of national gas supplies. This demand should reflect gas required during the coldest anticipated weather or disruption of infrastructure under average winter conditions. Furthermore, member states would have to ensure if their largest gas infrastructure fails, that the remaining network could meet total daily gas requirements, again on a day of exceptionally high demand. Also, cross-border interconnections between member states would have to be installed within three years of the regulation coming into force.

More EU oil and gas news:

*The European Commission (EC) is mulling whether to extend EU regulations that could help prevent a repeat in European waters of BP’s Gulf of Mexico rig explosion or mitigate damage caused. Officials and commissioners are openly debating the idea in Brussels. EU Environment Commissioner, Janez Potocnik, has told journalists the EC should either draft specific offshore drilling regulations or strengthen existing laws, for instance, by extending EU environmental liability rules from just coastal areas to all seas and oceans. *EU Energy Commissioner, Günther Oettinger, has said EU governments should consider suspending new deepwater drilling until experts have investigated BP’s Deepwater Horizon accident. This follows a temporary ban by Norway. ‘What’s good for Norway should be good for EU member states,’ he said.

*Oettinger is considering proposing that legally binding national commitments on energy efficiency should be made by EU governments, when he releases a new action plan on energy efficiency next year.

*Innovative oil and gas companies have been asked by the EC to propose energy research projects for funding out of a EUR6.4bn pot from the EU’s seventh framework programme for research and development. Brussels has outlined 30 energy topics where it wants to fund studies. These include: renewable energies (photovoltaics, CSP, wind energy, bioenergy, solar heating and cooling); carbon capture and sequestration; smart electricity networks; and energy efficiency. For details, see

*Environment ministers from the UK, Germany and France have teamed up to demand that the EU should unilaterally cut its carbon emissions by 30% by 2020, rather than the current EU 20% target. They have written a joint article saying this would shore-up Europe’s position in the global low carbon technology market.

*The EC has approved the proposed acquisition of US-based oilfield service provider Smith International by its rival Schlumberger. It concluded the companies offered complimentary services, and so a merger would not damage competition within Europe.

*The EU Council of Ministers has accepted a new regulation for the operation of EU electronic registries for greenhouse gas permits, tracking the issue, holding, transfer and cancellation of emission allowances and reduction credits.

*The EC has laid down a cap on the number of emission allowances available under the EU Emissions Trading System in 2013, the first year of the new 2013-2020 trading period. It will be 1.927bn, following a formula applying a 1.74% annual reduction in allowances from the average approved for 2008-2012.

*EU Ministers have approved the updating of an EU directive on the inland transport of dangerous goods, to take account of scientific progress and reforms to international agreements on transporting dangerous goods by road, rail and inland waterways. The new rules take force from January to June 2011.

*A Ukraine gas law opening its market for gas sales by competing companies has been welcomed by Energy Comissioner Oettinger as a ‘first step’ in reducing the country’s dependence on Russian gas imports.

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