BP, come on down

Iraqi oil contract auction

The start of Iraq’s oilfield contract bidding round is the key oil story of the day, with BP’s consortium taking the honours for first contract winner, apparently under-cutting on price and over-promising on output versus rival Exxon Mobil.

There were some conflicting details being reported (see WSJ vs Reuters, for example) in the hours after the landmark auction was televised in almost a game show-style production, suggesting it will take at least a few days to figure out the full implications of the bidding round. However, early indications are that Iraq’s Ministry of Oil was having more trouble than it would have hoped for in getting traction for the bulk of fields on offer.

As we write today, there is still a lot to be decided and much disagreement between policy-makers, which no doubt was in the minds of oil companies in Baghdad, as well as the ongoing violence that could still pose a threat, especially as Tuesday also marked Iraq’s National Sovereignty Day and the offical pullback of US troops from the country’s urban streets.


What up Nigaz?

Add to the long annals of branding faux pas, the Russian national gas champion’s foray into Nigeria.

As Branding Republic points out, the conflation of its new market, Nigeria, with the parent company name, Gazprom, may be logical enough. But the result — Nigaz — may be testament to Gazprom’s relative lack of international branding sophistication.

Announcing the joint venture with Nigerian National Petroleum Corp. (NNPC), Gazprom said “Nigaz will build refineries, pipelines and gas power stations in Nigeria.” Which is commendable. But will Gazprom ride out the inevitable ridicule, or succumb to a name change, as the “Pinto” did in Brazil.

Chatter on the road to Copehagen

As expected, the compromise US climate bill passed the House vote hurdle and now faces a summer of Senate committee haggling before it gets a vote in the upper chamber. The danger is that, after all the nibbling, President Obama will have signed a very enfeebled act into law just as his team heads to Copenhagen for post-Kyoto talks at the end of the year, losing leverage over China and others in terms of the emission-cutting commitments they might hope to negotiate.

Meanwhile, policy may be more settled in the UK but the debate about how actually to achieve results rumbles on. On Monday, the Royal Society (Britain’s preminent scientific thinking shop) published a report that laments the ratio of talk to progress. The report’s author, Professor John Shepherd, says it’s time to get a move on: “It is difficult to predict what will be required in 50 years time or what breakthroughs will have been made but we must deploy the technologies we have now and not be afraid of being radical in our thinking about new sources of energy.”

Monday’s report is actually based on discussions that took place last November, and there are links to summaries, slides and audio of the discussions available here.

Discussing the Royal Society report Monday morning on BBC’s Today programme, an Iposos-MORI pollster put his finger on the dilemma facing the US, UK and many other governments: most people believe that climate change is happening, but only 4% believe they personally can do anything about it; 66% believe it is up to the government, but they give only “latent permission, not explicit permission” for the government to take action. That means when it comes to the crunch, climate change ranks well down the list of priorities, especially in an economic recession.

Also on the programme, long-time environmental activist and chairman of the UK’s Sustainable Development Commission, Jonathan Porritt, said the UK government has been dithering for a decade, pointing to “poor old John Prescott’s integrated transport policy” from 1998, which was overtaken by events and came to little.

The government’s latest “Road to Copenhagen” initiative sounds good, Mr. Porritt said, “if only we got on and did the stuff that we know we have to do we’d all be looking at a much sunnier prospect for those trying to address climate change.”

Unloved US climate bill near finish line

As President Obama and his Democratic Party allies push to pass landmark climate change legislation, [the American Clean Energy and Security Act], Time magazine laments the “watered-down deal” that has left many of the players on both sides of the argument displeased, though The New York Times sees it as, at least, “an important beginning”, putting a price for the first time on carbon dioxide emissions.

Among its many critics, Greenpeace USA argues that the bill mandates a curb on CO2 emissions amounting to only one-tenth of the minimum cuts called for by the UN panel, cuts which are further undermined by emissions allowances and a misguided faith in the “myth of carbon capture and sequestration” for coal-fired power plants. The Greenpeace statement goes on:

“Worst of all, the Waxman-Markey bill will actually remove the President’s existing authority to regulate greenhouse gases under the Clean Air Act—authority recently reaffirmed by the Supreme Court. At a time when we need should be pursuing every available means to stop global warming, Congress should not be throwing one of the most powerful tools at the President’s disposal.”

Also opposing, but for opposite reasons, the American Petroleum Institute says the legislation will cost vastly more than the government’s budget office estimates and calls the legislation “a job killer”.

Where’s the support? Well, Al Gore’s on board. Now fronting the Alliance for Climate Protection, the former vice president and Nobel Prize winner argued in a teleconference earlier this week that opponents of the bill are scaremongering about the costs to taxpayers.

Meanwhile, the Democrats in the House were “within striking distance” of garnering enough votes to pass the bill on Friday, according to Roll Call.

The cap-and-trade mob

Roll Call, an Economist Group sister publication, has a new briefing package on attempts at energy reform in the USA, including articles by various of the main political actors.

The aptly named Gene Green (Democratic-Texas, and member of the House Energy and Commerce Committee) argues for the  Act, while his fellow Texan and committee member, Joe Barton (pictured above), worries that some kind of cap-and-trade Al Capone figures might emerge from the whole thing.

It’s a heated debate, of course, but as the lead article points out, there are winners and losers across the political spectrum and they don’t align according to party political lines. There are Republican windpower-mongers as well as Democtratic oil patch advocates.