Gas powers meet to discuss cartel

DOHA – Leading gas powers discussed yesterday the idea of transforming their benign grouping into an Opec-style cartel, but sought to reassure consumer nations that it was business as usual for now.

Host nation Qatar, home to the world’s third largest gas reserves, rejected the idea of a cartel and insisted the Gas Exporting Countries Forum would work to keep producers and consumers happy. “I hate the word cartel,” Qatari Energy Minister Abdullah bin Hamad al-Attiyah told reporters as he went into the gas group’s first ministerial meeting in two years.He said the scheme would be discussed, saying the forum had an open agenda, but he emphasised cooperation between producers and consumers.”We should work towards greater cooperation to stabilise the market, to give confidence to our consumers.We should send a very positive statement to our customers that we are with you, not against you,” Attiyah said.The prospect of converting the 14-member gas grouping into a more aggressive body was rekindled in January by Iran’s supreme leader, and more hawkish ministers have seized on the idea.”We think such an organisation would be beneficial.There are proposals for it, but such a process would be lengthy,” said Iranian Energy Minister Kazem Vaziri-Hamaneh.Venezuela, a political ally of Iran, also backed a gas version of the Organisation of the Petroleum Exporting Countries (Opec), and together with fellow South American energy producer Bolivia, is also striving to set up a regional cartel.”I think it is a very good idea.Gas is the second source of energy in the world,” said Rafael Ramirez, energy minister of Venezuela.”We need to defend our interests.”Neither Iran nor Venezuela is a gas exporter, although they hold large reserves which they are expected to develop eventually.Russia, the world’s biggest gas supplier, has played down the Opec suggestion, even though the nation’s president earlier this year described the idea as interesting.Russian Energy Minister Viktor Khristenko said this weekend Russia had no intention of fixing prices at consumer nations’ expense.”We do not, and will not, set ourselves the goal of ganging up on anybody.”It would be destructive and it would make no sense at all,” Khristenko said, adding that he wanted the forum to form part of global energy dialogue between producers and consumers.Khristenko was speaking in Moscow on Saturday and has refused to comment further since his arrival in Doha though Russian news agencies quoted him as saying he would propose hosting the next meeting of the gas exporters’ forum in Russia.Analysts say Russia needs to reassure its customers it is reliable as the leading gas supplier has twice halted energy exports to Europe in pricing disputes with transit countries.TALKING SHOP Since its formation in 2001, the gas producers’ forum, responsible for around 60 per cent of world gas exports, has been viewed by analysts as a talking shop.Although the rising importance of gas as an energy source has raised its profile, they did not expect any radical decisions at yesterday’s meeting.Several ministers said the possibility of the group becoming an Opec was impractical as gas producing nations each look to supply different regions of the world and usually set prices on the basis of long-term contracts.”Gas and oil are different,” said Indonesia’s Energy Minister Purnomo Yusgiantoro.Algerian Energy and Mines Minister Chakib Khelil agreed.”There is a small, liquid (gas) market, but that does not justify the creation of an Opec-like organisation,” he said.”In theory, we can talk a little bit more and maybe develop the idea.”Analysts view the advent of liquefied natural gas (LNG) as a move toward a more liquid, global gas market.LNG is gas cooled to liquid form so it can be shipped to various markets and is far more flexible than pipeline gas, which is supplied to long-term customers.Since last year, when it snatched the number one position from Indonesia, Qatar has been the world’s leading LNG exporter.Nampa-Reuters”I hate the word cartel,” Qatari Energy Minister Abdullah bin Hamad al-Attiyah told reporters as he went into the gas group’s first ministerial meeting in two years.He said the scheme would be discussed, saying the forum had an open agenda, but he emphasised cooperation between producers and consumers.”We should work towards greater cooperation to stabilise the market, to give confidence to our consumers.We should send a very positive statement to our customers that we are with you, not against you,” Attiyah said.The prospect of converting the 14-member gas grouping into a more aggressive body was rekindled in January by Iran’s supreme leader, and more hawkish ministers have seized on the idea.”We think such an organisation would be beneficial.There are proposals for it, but such a process would be lengthy,” said Iranian Energy Minister Kazem Vaziri-Hamaneh.Venezuela, a political ally of Iran, also backed a gas version of the Organisation of the Petroleum Exporting Countries (Opec), and together with fellow South American energy producer Bolivia, is also striving to set up a regional cartel.”I think it is a very good idea.Gas is the second source of energy in the world,” said Rafael Ramirez, energy minister of Venezuela.”We need to defend our interests.”Neither Iran nor Venezuela is a gas exporter, although they hold large reserves which they are expected to develop eventually.Russia, the world’s biggest gas supplier, has played down the Opec suggestion, even though the nation’s president earlier this year described the idea as interesting.Russian Energy Minister Viktor Khristenko said this weekend Russia had no intention of fixing prices at consumer nations’ expense.”We do not, and will not, set ourselves the goal of ganging up on anybody.”It would be destructive and it would make no sense at all,” Khristenko said, adding that he wanted the forum to form part of global energy dialogue between producers and consumers.Khristenko was speaking in Moscow on Saturday and has refused to comment further since his arrival in Doha though Russian news agencies quoted him as saying he would propose hosting the next meeting of the gas exporters’ forum in Russia.Analysts say Russia needs to reassure its customers it is reliable as the leading gas supplier has twice halted energy exports to Europe in pricing disputes with transit countries.TALKING SHOP Since its formation in 2001, the gas producers’ forum, responsible for around 60 per cent of world gas exports, has been viewed by analysts as a talking shop.Although the rising importance of gas as an energy source has raised its profile, they did not expect any radical decisions at yesterday’s meeting.Several ministers said the possibility of the group becoming an Opec was impractical as gas producing nations each look to supply different regions of the world and usually set prices on the basis of long-term contracts.”Gas and oil are different,” said Indonesia’s Energy Minister Purnomo Yusgiantoro.Algerian Energy and Mines Minister Chakib Khelil agreed.”There is a small, liquid (gas) market, but that does not justify the creation of an Opec-like organisation,” he said.”In theory, we can talk a little bit more and maybe develop the idea.”Analysts view the advent of liquefied natural gas (LNG) as a move toward a more liquid, global gas market.LNG is gas cooled to liquid form so it can be shipped to various markets and is far more flexible than pipeline gas, which is supplied to long-term customers.Since last year, when it snatched the number one position from Indonesia, Qatar has been the world’s leading LNG exporter.Nampa-Reuters