Eni Chief Executive Officer Paolo Scaroni at Atlantic Council: Europe must focus on shale gas deposits
A new deal focused on energy efficiency, better exploitation of conventional hydrocarbons. Mainly on shale gas. This being stated by Eni CEO Paolo Scaroni to fight the costs of energy avoiding Italian and European companies to get economic recovery. Scaroni has shown his priorities to the international audience of American think tank Atlantic Council, during his opening speech about the new global energy scenarios.
Paolo Scaroni has indicated two directions: the development of non-conventional sources and the development of new strategic political partnerships.
Shale gas exploitation as an opportunity – Scaroni started watching overseas: “the US is set to score well in the global competition for industrial investments for decades to come. That’s because – in addition of your business-friendly environment, qualified workforce and strong internal market – you now have really plenty of cheap energy to fuel growth”. So, the shale gas revolution has upset the balance of the energy market: a mechanism that is helping the United States, but is heavily penalizing Europe: “Our industry – already battered by low demand and rigid labour markets– now has to contend with natural gas prices which are three times as high as those in the US, and electricity prices which are more than twice as high”. That’s why “European gas demand is down 15 % since 2008”. For Scaroni “European and italian businesses need to be able to count on gas prices competitive to survive”.The exploitation of shale gas, as the US example, is a great opportunity , but, said Scaroni, “we need political consensus to be able to it ” Consensus that, at the moment, there is not.
Intensifying relationships with Russia and North Africa as a priority – There is another, more radical, solution: “to strengthen Europe’s commercial and political ties with North Africa, especially Algeria and Libya, and Russia, whose “long-terms interests coincide with those of Europe”. Russia because “if our businesses could gain access to plentiful and cheap Russian gas, everybody would win”, North Africa because “it will confound pessimists to become a flourishing region” on which to focus.Scaroni speech has collected the consent of many experts. Davide Tabarelli, Nomisma Energia President, said: “the reason for the gas in the USA costs a third than in Europe, is because the production costs of shale gas are low, but are higher than production costs of conventional gas in North Africa and Russia. We have many opportunities closebound and we should work to buy gas from these countries at prices closer to their costs”.
Source: Daily Focus