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The Lebanese Army has its work cut out sanctions could therefore thwart construction.
trying to clamp down on the smuggling of sub- Washington could threaten measures against
sidised fuel across the border into Syria. The companies hoping to buy gas supplied by Nord
problem, which has exacerbated Lebanon’s eco- Stream 2. But Germany would strongly oppose
nomic crisis, shows no sign of abating despite the such a move, viewing it as US interference in
government’s claims of progress. what Berlin has insisted is “a purely commercial
Nigeria needs to do more to encourage the project.”
construction of modular oil refineries, a devel-
oper of one such plant has said. These small- If you’d like to read more about the key events shaping
sized refineries will help Nigeria overcome its Europe’s oil and gas sector then please click here for
reliance on fuel imports, which has grown since NewsBase’s EurOil Monitor .
the shutdown of its outdated, loss-making state
plants. Further Russian losses Russia’s
Gazprom Neft has become the latest Russian oil
If you’d like to read more about the key events shaping and gas producer to post a net loss for the first Gazprom, by far
the downstream sector of Africa and the Middle East, quarter on low prices and ruble devaluation. Europe’s biggest
then please click here for NewsBase’s DMEA Monitor. Rosneft and Novatek also slipped into the red
for similar reasons. gas supplier,
European gas demand still weak While blessed with low production costs,
European gas demand remains subdued, despite Russian companies are having to cut their cap- has also cut
the slow easing of COVID-19 lockdowns. Rus- ital expenditure to protect their earnings, much
sian gas flows via the Yamal-Europe pipeline that like their international peers. After all, the profits shipments via
runs through Belarus and Poland to Germany of state firms serve as a key source of revenue for other routes
slumped to zero last week, with the continent’s the Russian government. VTB Capital (VTBC)
gas storage levels at an unprecedented high for expects Gazprom Neft to reduce its full-year including
this time of year. overall capital expenditure by around 25% from
Russia’s Gazprom, by far Europe’s biggest gas its initial guidance, to RUB335bn ($4.8bn). Ukraine.
supplier, has also cut shipments via other routes, Despite the market collapse, parent company
including Ukraine. But its ship-or-pay transit Gazprom is counting on strong gas demand
deal with Kyiv means it will pay to pump 65 bcm growth in the long run. It recently launched the
of gas through Ukraine’s pipelines regardless of planning phase for a second pipeline to China,
whether it actually sends that much. Norwegian and also revealed last week it had resumed devel-
gas supplies to Europe were below the five-year opment studies for the offshore Shtokman gas
average last month but are now at normal sea- field in the Russian Arctic – a project it tried to
sonal levels. advance for more than a decade before shelving
Meanwhile, US lawmakers are seeking to it in 2013.
impose additional sanctions on Gazprom’s Nord Gazprom’s reappraisal of the high-cost and
Stream 2 gas pipeline to Germany, in a last-ditch challenging project is oddly timed, given that
attempt to prevent the project’s completion. US global gas prices are at their lowest level in
Senators Ted Cruz, a Republican, and Jeanne decades.
Shaheen, a Democrat, are reported to be plan- An investigation by Russian news outlet
ning to introduce a bill this week containing new Lenta.ru has meanwhile cast doubt on Gaz-
measures. prom’s ability to deliver on its existing supply
Further US pressure is unlikely to make a commitments to China. The report claimed the
difference at this stage. Sanctions imposed by company risked losing $20bn and would strug-
Washington last December led to Swiss-based gle to fulfil its 2014 supply deal with China’s
contractor Allseas abandoning the pipeline, with CNPC after overestimating the capacity of its
just 6% of its offshore section left to complete. production sites in Eastern Siberia.
Russia is preparing to finish the job with its own In Kazakhstan, Chevron has announced that
pipelaying vessel, which is currently moored at 20,000 workers, or two-thirds of the workforce,
a German port. It is hard to see how additional at the giant Tengiz oilfield will be demobilised

P6 www. NEWSBASE .com Week 22 04•June•2020