Energy

• China is the 2nd largest consumer and no.2 oil importer (3m barrels per day)
• 1000 new cars hit Beijing daily; 8.5 million move to Chinese cities yearly
• Industrialisation demands energy and economy has doubled every 8 years

ENERGY MIX:

Expanding nuclear - 2020 = 4% of power
Coal and oil = 89% of the mix (largest producer and consumer of coal; has 13% reserves)
No.1 for HEP resources
Aims for 16% of electricity from New Energy by 2020

SECURE?
China has protected it's imports from the Middle-East by...

• Having a powerful navy
• Importing from a variety of countries
• Investing $46bn in Pakistan which opens up alternate trade routes (invests double what Pakistan recieved over all in 2008)

Insecure because...

• Depleting reserves means has to import oil (9.4 m barrels/day)
• High demand; American's consume 100x more electricity than those in Kiribati
• Increasing price to $200 per barrel in 2 years

California's black outs 2000-2001
- Droughts 1997 to 2000 increased use of air conditioning
- Deregulation of power industry in 1996 due to privatisation
- Anti-pollution laws 1970 = insufficient generating capacity

ENRON manipulated the energy market - ensured prices stayed high even when supply was plentiful so it crashed.
Solutions = megawatt laundering, overscheduling and moving energy round the grid.

1960-2003 saw an 18% increase of imported gas and oil
- Increased dependence, limited energy mix and risk of political instability in exporters.

2600 miles when complete, costing $12bn.
Aim: to export China, Japan and Korea because Europe is currently the only market.

Japan wants it because only 1% of it's demand can be covered by it's own resources, to diversify and was Russia's main energy partner until 2005.
China wants it because it's the largest consumer, Russia's reserves are 5x the size of China's.

Russia can export to the highest bidder = ECONOMIC GAIN

Costs...

• Construction impacts on Japan's fishing industry and wildlife
• Increasing steel prices
• Large public opposition
• Spill protection technology is badly maintained especially in permafrost.

Initial route was too close to UNESCO protected Lake Baikal and in areas where remaining Amur leopards lives.

Russia supplies 30% of Europe's energy; there are 2 main pipelines entering through Ukraine and Belarus.

March 2005
Dispute began over the price of natural gas supplied and the cost of transit - Russia claimed Ukraine was not paying for gas but diverting it to use domestically.
They quadrupled the price of their gas to Ukraine, who refused to pay.

GazProm cut off gas to Ukraine in January 2006.
This meant the flow of gas to the rest of Europe fell by 40%.

Europe has to look for alternative energy sources because it's UNSTABLE importing mainly from Russia = dependency.

• Gas bridge from Asia to Europe; starting in Turkey and finishing in Austria.
• 3300 km, costing £7.9 billion
• Start 2011 completion in 2016

AIM: to supply EU with gas or it's increasing demand to reduce Europe's dependence on Russia.

Set backs...

Turkey and Azerbaijan disputes - Shah Deniz company haulted drilling

Depths beyond 400m; shallow water reserves are now exhuasted (expensive + dangerous)
Rising oil prices mean greater investment ($35bn)

Deep Water Horizon Oil-Rig - BP in the Gulf of Mexico April 2010
Gas release and subsequent explosion; fire burn for 36 hours before rig sank and hydrocarbons leaked out into the gulf for 87 days.

Impacts...
11 died, many were injured
8000 birds, turtles and marine mammals found dead 6 months after
1/2 dolphins are ill - hit peak of breeding season so food web was altered

Decrease in tourism as holidays were cancelled, hotels cut rates to attract guests, BP gave $25 million to promote uneffected areas California.
Decrease in fisheries; they had to close (heavily rely on industry) - livelihoods?

BP was fined $40 billion in clean up costs and settlements + $16 billion 'Clean Water Act'.

1400 accidents - Exxon Valdez oil spill killed 250 000 birds

5.5million m2 contains 13% of the world's undiscovered supply.
Sept 2015 - Shell abandoned exploration due to disappointing oil and gas quanities.

PROs:

• Consumer countries rely less on unstable countries
• 1/4 of the world's untapped oil - could meet global demand for 3 years 
• Reduces reliance on more polluting coal

CONs:

• Disrupts inuit tribes and dangerous areas = 50ft waves
• Seasonal drilling as only 20% of region has boat access in winter
• Ice melted for rigs ad toxins thrown overboard during extraction (PAH)
• Oil spills trapped in ice endagers edemic species

ANWR - Alaska is the largest protected wilderness. Obama opposes drilling due to damage to the area while uncertain how much oil will be found. Bush supports drilling to reduce dependence.

Canada - half of oil production comes from tar sands. 3 barrels of water to 1 barrel of oil.

Benefits...

• jobs for 514 000
• 170 billion barrel reserves
• economic contribution of $2.1 trillion over the next 25 years
• Canada is a stable source country

Costs...

• increased CO2 emissions
• pollutes Athabasca river - Boreal forests have to be cut down
• increasing rare cancers in the area
• refining is expensive and polluting

KEY PLAYERS
Natwest, shell and oil companies drive extraction
Greenpeace Canada and locals are against exploitation

Injecting liquid at high pressure into rocks to open fissues for oil/gas release.

Controversial...

• Water supplies are contaminated
• Uses water which is a scarce resource
• Fossil fuels released = GHGs

2014 Cameron had a pro shal gas exploration programme; GeolSurvery 25 trillion cubic feet of gas in Yorkshire/Lancashire.

New developments to make it sustainable...
- recycling water, plugging methane leaks and treating waste water

REFRACKING: companies re-enter and re-frack existing wells at 25% of the cost
UK and USA are pro to expand their economies and reduce dependence
But it's expensive and costs more than the profit.

Terrorist Attack in Abiqaiq February 2006

• Explosives sent to the largest oil processing plant in the world al-Queda
• 4 killed, no damage to the plant

2025 Middle East will be the largest producers - 2/3rds of the world supply despite the West trying to reduce it's dependence.

OPEC - reluctant to increase supplies from 2002 because there's a risk price crash as China and India's demand increases.

POLITICAL INSTABILITY 

Nigeria; threaten supplies and kidnap workers

USA invaded Iraq - March 2003
Saddam Hussein (leader of Iraq then) threatened US supplies
USA put sanctions on Iraq through the UN for their use of chemical weapons prior to invasion

USA and Saudi Arabia
Mutualism: USA needs oil and Saudi Arabia needs military defence

USA is excluded from Russia, Iran and China's energy trading but the USA tried to isolate Iran (a production hotspot) by imposing sanctions by the UN.

Oil is a STRATEGIC RESOURCE