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Russia strengthening energy ties to Bangladesh

Moscow’s Gazprom energy company is expanding projects in one of the world’s most populous countries

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(New Eastern Outlook) – As it is well known, the economy of the People’s Republic of Bangladesh (PRB) is one of the least developed, but one of the fastest growing economies of Asia demonstrating steady growth in the last few years. Today many countries seek to cooperate with PBR, in the hope of making profitable investments, gaining access to its growing markets and cheap labor. Among them are India, China, South Korea, Japan, the United Kingdom, USA and other states.

Russia has achieved significant success in the development of relations with Bangladesh concluding a partnership with this country in a strategically important area such as energy. The Russian Federation plays an important role in the oil and gas industry of PRB and is a key figure in its atomic project.

Fuel shortage is a major problem for Bangladesh. There is a significant reserve of oil, coal and natural gas in its territory, that country pins great expectation economic development with. However, since the early 2000’s, the exploration and development of new deposits in the PBR were not conducted.

In 2010, the Bangladesh Government turned towards Russia for assistance in such matters as exploration of new hydrocarbon deposits, their development and establishment of a unified gas supply system in its territory. Later, negotiations started between the leadership of Bangladesh and Russian state oil and the gas corporation “Gazprom”. Soon Gazprom signed a memorandum of mutual understanding with Bangladesh Minerals, Oil and Gas Corporation “Petrobangla”.

Gazprom International (GI), a company affiliate of Gazprom specializing on search and production of hydrocarbons outside of the Russian Federation, was entrusted to work with the Bangladeshi partners. In 2011, the GI proposed the leadership of the PRB its program for the development of Bangladeshi deposits and establishment of a single Bangladeshi gas supply system (a similar Russian system was taken as a model).

In 2012, GI signed a number of contracts with ВАРЕХ, BGFCL and SGFL – the subsidiaries of Petrobangla, in accordance with which the Russian company began to drill and equip ten wells with a depth of 3-4 km at the gas fields of PRB. The work began in the spring of 2013 and by November 2014, all ten wells were put on regular operational mode. The results were very satisfying to the Bangladeshi side that it readily continued to develop its cooperation with the Russian company.

In the autumn of 2015, GI signed new agreements with the same Bangladeshi companies to drill five wells more. The work was completed before the deadline at the end of 2016.

In March 2017, GI and ВАРЕХ agreed to build two more wells on the island of Bhola in the southern part of Bangladesh.

In December 2017, GI started drilling “North Bhola-1” well. Its depth is to be 3.55 Km. The area where the drilling is conducted has high terrastatic pressure, which require the use of advanced technologies that Russian drillers possess. This fact once again confirms the rightness of the decision of the Bangladeshi leadership to cooperate with Russia.

In 2017, the average level of natural gas production in Bangladesh was about 70 million cubic meters per day and the annual production amounted to about 27 billion cubic meters. It is reported that about 10% of this volume is produced in wells built by GI. It is still not sufficient to completely cover the country’s needs of natural gas (which is about 30 billion cubic meters per year). But, provided that the current pace of the construction of wells is maintained, the required volume of production can be achieved and exceeded in the coming years.

Currently, the PRB leadership is considering a new five-year programme of development of its gas fields. If it is approved, GI may obtain an order to drill about 100 more wells. Moreover, the possibility of creating a joint venture of GI and BAPEX is being discussed for implementation of joint projects in the oil and gas sector. In addition, the Russian side expressed its intention to undertake training of qualified personnel for the Bangladeshi hydrocarbon industry, both on the basis of Russian universities and in Bangladesh, where a specialized training centre is planned to be created with the support of Russian specialists.

Another important point of contact between Russia and Bangladesh is – Atomic energy. In 2011, the countries signed an Agreement on the construction of first Bangladeshi APP “Rooppur”. The work was entrusted to “AtomStroiExport”- a company within the Russian State Atomic Corporation “RosAtom” established for working abroad. In 2015, the head of “RosAtom” Sergey Kirienko arrived in Bangladesh. At that time, the main contract was signed and it became known that the cost of the project would exceed $12 billion dollars. The majority of the required amount was provided by Russia giving Bangladesh a loan of $11.38 billion dollars in 2016.

It is important to noted that the 2011 agreement was signed after the catastrophe at the Japanese nuclear power plant Fukushima-1″ which occurred in March 2011, after which many countries froze their nuclear projects or rejected them altogether. A significant role in the selection of PRB in favour of cooperation with the Russian Federation played its Enhanced Safety Standards, which are adhered to by Russian nuclear scientists and a special protection system they equip their WWER model reactors with. It is believed that nuclear power plants built by Russian technologies are able to withstand severe strokes. This is particularly important for Bangladesh, which is located in a hazardous area, periodically experiencing powerful hurricanes and floods.

Thus, one may conclude that cooperation with Russia plays an important role in the development of the Bangladeshi energy sector. This makes Russia one of the key partners of PBR and contributes to the development of relations between the two countries in all fields. Mutual Russian-Bangladeshi trade turnover increased almost twice during the period of 2012-2016, surpassing $1.4 billion dollars in 2016. Cooperation in military-technical sphere is developing, which together with nuclear cooperation testifies to a special trust between the two states. Given Bangladesh’s special relation with India and the China’s growing interest in it, a presumption can be made that cooperation with Bangladesh can strengthen the Russian positions in the Asia and Pacific region.

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Russia’s Lukoil Halts Oil Swaps In Venezuela After U.S. Sanctions

Under the new wide-ranging U.S. sanctions, Venezuela will not be able to import U.S. naphtha which it has typically used to dilute its heavy crude grades.

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Via Oilprice.com


Litasco, the international trading arm of Russia’s second-biggest oil producer Lukoil, stopped its oil swaps deals with Venezuela immediately after the U.S. imposed sanctions on Venezuela’s oil industry and state oil firm PDVSA, Lukoil’s chief executive Vagit Alekperov said at an investment forum in Russia.

Russia, which stands by Nicolas Maduro in the ongoing Venezuelan political crisis, has vowed to defend its interests in Venezuela—including oil interests—within the international law using “all mechanisms available to us.”

Because of Moscow’s support for Maduro, the international community and market analysts are closely watching the relationship of Russian oil companies with Venezuela.

“Litasco does not work with Venezuela. Before the restrictions were imposed, Litasco had operations to deliver oil products and to sell oil. There were swap operations. Today there are none, since the sanctions were imposed,” Lukoil’s Alekperov said at the Russian Investment Forum in the Black Sea resort of Sochi.

Another Russian oil producer, Gazprom Neft, however, does not see major risks for its oil business in Venezuela, the company’s chief executive officer Alexander Dyukov said at the same event.

Gazprom Neft has not supplied and does not supply oil products to Venezuela needed to dilute the thick heavy Venezuelan oil, Dyukov said, noting that the Latin American country hadn’t approached Gazprom Neft for possible supply of oil products for diluents.

Under the new wide-ranging U.S. sanctions, Venezuela will not be able to import U.S. naphtha which it has typically used to dilute its heavy crude grades. Analysts expect that a shortage of diluents could accelerate beginning this month the already steadily declining Venezuelan oil production and exports.

Venezuela’s crude oil production plunged by another 59,000 bpd from December 2018 to stand at just 1.106 million bpd in January 2019, OPEC’s secondary sources figures showed in the cartel’s closely watched Monthly Oil Market Report (MOMR) this week.

By Tsvetana Paraskova for Oilprice.com

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Germany Pulls Rank on Macron and American Energy Blackmail

Why France’s Macron, at the last minute, attempted to undermine the project by placing stiffer regulations is a curious question.

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Authored by Finian Cunningham via The Strategic Culture Foundation:


It was billed politely as a Franco-German “compromise” when the EU balked at adopting a Gas Directive which would have undermined the Nord Stream 2 project with Russia.

Nevertheless, diplomatic rhetoric aside, Berlin’s blocking last week of a bid by French President Emmanuel Macron to impose tougher regulations on the Nord Stream 2 gas project was without doubt a firm rebuff to Paris.

Macron wanted to give the EU administration in Brussels greater control over the new pipeline running from Russia to Germany. But in the end the so-called “compromise” was a rejection of Macron’s proposal, reaffirming Germany in the lead role of implementing the Nord Stream 2 route, along with Russia.

The $11-billion, 1,200 kilometer pipeline is due to become operational at the end of this year. Stretching from Russian mainland under the Baltic Sea, it will double the natural gas supply from Russia to Germany. The Berlin government and German industry view the project as a vital boost to the country’s ever-robust economy. Gas supplies will also be distributed from Germany to other European states. Consumers stand to gain from lower prices for heating homes and businesses.

Thus Macron’s belated bizarre meddling was rebuffed by Berlin. A rebuff was given too to the stepped-up pressure from Washington for the Nord Stream 2 project to be cancelled. Last week, US ambassador to Germany Richard Grenell and two other American envoys wrote an op-ed for Deutsche Welle in which they accused Russia of trying to use “energy blackmail” over Europe’s geopolitics.

Why France’s Macron, at the last minute, attempted to undermine the project by placing stiffer regulations is a curious question. Those extra regulations if they had been imposed would have potentially made the Russian gas supply more expensive. As it turns out, the project will now go-ahead without onerous restrictions.

In short, Macron and the spoiling tactics of Washington, along with EU states hostile to Russia, Poland and the Baltic countries, have been put in their place by Germany and its assertion of national interests of securing economical and abundant gas supply from Russia. Other EU member states that backed Berlin over Nord Stream 2 were Austria, Belgium, Cyprus, Greece and the Netherlands.

Washington’s claims that Nord Stream 2 would give Russia leverage of Europe’s security have been echoed by Poland and the Baltic states. Poland, and non-EU Ukraine, stand to lose out billions of dollars-worth of transit fees. Such a move, however, is the prerogative of Germany and Russia to find a more economical mode of supply. Besides, what right has Ukraine to make demands on a bilateral matter that is none of its business? Kiev’s previous bad faith over not paying gas bills to Russia disbars it from reasonable opinion.

Another factor is the inherent Russophobia of Polish and Baltic politicians who view everything concerning Russia through a prism of paranoia.

For the Americans, it is obviously a blatant case of seeking to sell their own much more expensive natural gas to Europe’s giant energy market – in place of Russia’s product. Based on objective market figures, Russia is the most competitive supplier to Europe. The Americans are therefore trying to snatch a strategic business through foul means of propaganda and political pressure. Ironically, the US German ambassador Richard Grenell and the other American envoys wrote in their recent oped: “Europe must retain control of its energy security.”

Last month, Grenell threatened German and European firms involved in the construction of Nord Stream 2 that they could face punitive American sanctions in the future. Evidently, it is the US side that is using “blackmail” to coerce others into submission, not Russia.

Back to Macron. What was he up to in his belated spoiling tactics over Nord Stream 2 and in particular the attempted problems being leveled for Germany if the extra regulations had been imposed?

It seems implausible that Macron was suddenly finding a concern for Poland and the Baltic states in their paranoia over alleged Russian invasion.

Was Macron trying to garner favors from the Trump administration? His initial obsequious rapport with Trump has since faded from the early days of Macron’s presidency in 2017. By doing Washington’s bidding to undermine the Nord Stream 2 project was Macron trying to ingratiate himself again?

The contradictions regarding Macron are replete. He is supposed to be a champion of “ecological causes”. A major factor in Germany’s desire for the Nord Stream 2 project is that the increased gas supply will reduce the European powerhouse’s dependence on dirty fuels of coal, oil and nuclear power. By throwing up regulatory barriers, Macron is making it harder for Germany and Europe to move to cleaner sources of energy that the Russian natural gas represents.

Also, if Macron had succeeded in imposing tougher regulations on the Nord Stream 2 project it would have inevitably increased the costs to consumers for gas bills. This is at a time when his government is being assailed by nationwide Yellow Vest protests over soaring living costs, in particular fuel-price hikes.

A possible factor in Macron’s sabotage bid in Germany’s Nord Stream 2 plans was his chagrin over Berlin’s rejection of his much-vaunted reform agenda for the Eurozone bloc within the EU. Despite Macron’s very public amity with Chancellor Angela Merkel, Berlin has continually knocked back the French leader’s ambitions for reform.

It’s hard to discern what are the real objectives of Macron’s reforms. But they seem to constitute a “banker’s charter”. Many eminent German economists have lambasted his plans, which they say will give more taxpayer-funded bailouts to insolvent banks. They say Macron is trying to move the EU further away from the social-market economy than the bloc already has moved.

What Macron, an ex-Rothschild banker, appears to be striving for is a replication of his pro-rich, anti-worker policies that he is imposing on France, and for these policies to be extended across the Eurozone. Berlin is not buying it, realizing such policies will further erode the social fabric. This could be the main reason why Macron tried to use the Nord Stream 2 project as leverage over Berlin.

In the end, Macron and Washington – albeit working for different objectives – were defeated in their attempts to sabotage the emerging energy trade between Germany, Europe and Russia. Nord Stream 2, as with Russia’s Turk Stream to the south of Europe, seems inevitable by sheer force of natural partnership.

On this note, the Hungarian government’s comments this week were apt. Budapest accused some European leaders and the US of “huge hypocrisy” in decrying association with Russia over energy trade. Macron has previously attended an economics forum in St Petersburg, and yet lately has sought to “blackmail” and disrupt Germany over its trade plans with Russia.

As for the Americans, their arrant hypocrisy is beyond words. As well as trying to dictate to Europe about “market principles” and “energy security”, it was reported this week that Washington is similarly demanding Iraq to end its import of natural gas from neighboring Iran.

Iraq is crippled by electricity and power shortages because of the criminal war that the US waged on that country from 2003-2011 which destroyed much of the country’s infrastructure. Iraq critically needs Iranian gas supplies to keep the lights and fans running. Yet, here we have the US now dictating to Iraq to end its lifeline import of Iranian fuel in order to comply with the Trump administration’s sanctions against Tehran. Iraq is furious at the latest bullying interference by Washington in its sovereign affairs.

The hypocrisy of Washington and elitist politicians like Emmanuel Macron has become too much to stomach. Maybe Germany and others are finally realizing who the charlatans are.

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Russia Readies Own Web To Survive Global Internet Shutdown

Russia is simultaneously building a mass censorship system similar to that seen in China.

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Via Zerohedge


Russian authorities and major telecom operators are preparing to disconnect the country from the world wide web as part of an exercise to prepare for future cyber attacks, Russian news agency RosBiznesKonsalting (RBK) reported last week.

The purpose of the exercise is to develop a threat analysis and provide feedback to a proposed law introduced in the Russian Parliament last December.

The draft law, called the Digital Economy National Program, requires Russian internet service providers (ISP) to guarantee the independence of the Russian Internet (Runet) in the event of a foreign attack to sever the country’s internet from the world wide web.

Telecom operators (MegaFon, VimpelCom (Beeline brand), MTS, Rostelecom and others) will have to introduce the “technical means” to re-route all Russian internet traffic to exchange points approved by the Federal Service for Supervision of Communications, Information Technology and Mass Media (Roskomnadzor), Russia’s federal executive body responsible for censorship in media and telecommunications.

Roskomnazor will observe all internet traffic and make sure data between Russian users stays within the country’s borders, and is not re-routed abroad.

The exercise is expected to occur before April 1, as Russian authorities have not given exact dates.

The measures described in the law include Russia constructing its internet system, known as Domain Name System (DNS), so it can operate independently from the rest of the world.

Across the world, 12 companies oversee the root servers for DNS and none are located in Russia. However, there are copies of Russia’s core internet address book inside the country suggesting its internet could keep operating if the US cut it off.

Ultimately, the Russian government will require all domestic traffic to pass through government-controlled routing points. These hubs will filter traffic so that data sent between Russians internet users work seamlessly, but any data to foreign computers would be rejected.

Besides protecting its internet, Russia is simultaneously building a mass censorship system similar to that seen in China.

“What Russia wants to do is to bring those router points that handle data entering or exiting the country within its borders and under its control- so that it can then pull up the drawbridge, as it were, to external traffic if it’s under threat – or if it decides to censor what outside information people can access.

China’s firewall is probably the world’s best known censorship tool and it has become a sophisticated operation. It also polices its router points, using filters and blocks on keywords and certain websites and redirecting web traffic so that computers cannot connect to sites the state does not wish Chinese citizens to see,” said BBC.

The Russian government started preparations for creating its internet several years ago. Russian officials expect 95% of all internet traffic locally by next year.

As for Russia unplugging its internet from the rest of the world for an upcoming training exercise, well, this could potentially anger Washington because it is one less sanction that can keep Moscow contained.

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