2.  Uninterrupted access to reliable sources of supply, at an affordable price where extraction does not have an undue impact on the environment

3.  Direct access to fossil fuel reserves is a coincidence of geological history and international boundaries.  Some countries find themselves with more fossil fuel sources than their needs  Others have none  Reserves run down over time, as is the gas with the UK’s once abundant North Sea oil and gas  Remaining oil and gas will increasingly concentrate in the Middle East over the next 30 years. Top 15 countries by oil, gas and coal reserves in 2008

4.  Physical – reserves are exhausted ie north sea oil/ gas or supply may be disrupted by natural hazards ie earthquakes or hurricanes.  Environmental – Green protestors/ Nimby’ism  Economic – rises in costs of energy  Geopolitical – Political instability – disputes/ conflicts/ wars

5.  Energy security depends on a number of factors (see table)  Countries with a diverse energy ‘mix’ are less at risk than those relying on 1 or 2 sources  Renewable potential could be used to offset declining fossil fuel reserves or supply interruptions  Reliance on long distance international trade in fossil fuels may be risky  Demand and dependency are important too, as it is difficult to replace a large amount of oil with another energy source for instance Domestic fossil fuel reserves Countries like Italy and Japan have few of their own resources Domestic renewable potential Small, crowded nations like Singapore and South Korea lack renewable potential Domestic energy mix France relies heavily on nuclear power, and the UK on gas. Import pathway risk The UK imports gas from Russia and Qatar, both long distance pathways.

6.  Fossil fuel supply regions are poorly matched with areas of largest demand  This is especially true for oil and gas  Energy must flow along international pathways from producer to consumer  These are either pipelines (oil and gas), bulk carriers (coal, uranium), LNG tankers (gas) or oil tankers. Electricity is also exported / imported.  Pathways could be disrupted, increasing energy insecurity. Pathway disruption Price and payment disputes Piracy e.g. off the Somali coast Terrorism or conflict closing choke points Political discord between supplier and consumer Diversion of supply, perhaps for a higher price Technical interrupti on to productio n Producer’ s supply simply runs out Natural disasters e.g. hurricane Katrina

7.  Gas pipeline disruption has already occurred, as disputes between Russia and Ukraine disrupted European gas supplies in 2006 and 2009  Russia holds 25% of world gas reserves, the Middle East 40% (and 56% of oil)  Disruption to narrow ocean choke points (see map) could seriously affect the flow of oil  Countries close to some choke points are unstable (Iran, Somalia, Yemen)

8.  There are real risks if oil and gas supplies are disrupted.  Any potential disruption is headline news  So dependent are we on cheap, uninterrupted energy supplies that disruption could lead to: 1. Soaring energy costs and rising energy poverty 2. Pressure on politicians to act; possibly rationing energy 3. Civil disruption 4. Rising costs for industry, job losses and recession 5. Unsound decisions (economically and environmentally) to rapidly develop alternative sources 6. Diplomatic conflict UK energy disruption Oct 1973 Oil crisis; petrol rationing Sept 2000 UK wide fuel protests over price and tax Aug 2005 Further UK protests; Hurricane Katrina pushes oil prices higher Aug 2008 Oil at $147 a barrel Jan 2010 National Grid ‘gas balancing alerts’ are headline news ; gas supply from Norway drops on technical problems

9.  There are a number of sources of tension, both present and future, related to energy security and the threat of insecurity: ScenarioExplanationConsequences Oil hits $100 Sustained oil price of over $100 per barrel, for several years. Prolonged economic recession and rising fuel poverty in OECD countries Middle East meltdown Tensions in the Gulf escalate into war between Muslim factions; possibly involving Iran, Iraq, Israel, Syria, Turkey and others. Interruption of oil and gas flows; rising prices; tension between China and USA to secure oil supply The nuclear option Wholesale shifting towards nuclear to replace fossil fuels, leads to global spread of nuclear power and technology Power stations become ‘soft targets’ for terrorism; enriched uranium and depleted plutonium get into the wrong hands…. Energy superpowers The Gulf States hold 60%+ of oil reserves and Russia/Qatar/ Iran 60%+ of gas; the world has not shifted to renewables. Energy superpowers begin to ‘name their price’ and take care of their friends; major geopolitical shifts Arctic attack Canada, Russia, USA and EU begin to exploit the Arctic for oil and gas, but without clear delineation of territorial areas. A war or words over who has the right to exploit what, quickly becomes a new cold war – possibly a hot one……

11.  On 12 th December 2009, Russia overtook Saudi Arabia as top exporter  Russia produced almost 10 million barrels of oil a day in August 2009 according to International Energy Agency figures  Russia has now begun to have uneasy relationships with their oil producing countries as it is now profiting from OPEC production costs.  The main beneficiary has been Vladimir Putin, who has claimed credit for delivering increased prosperity to Russia's 142 million citizens. However, some may argue that the winners have been Russia's oil-connected elite, who now enjoy lavish lifestyles.  Russia, however, has been badly battered by the global economic crisis, with GDP shrinking by more than 10% in the first half of 2009.

12.  Russia is rich in natural energy resources  It has the largest known natural gas reserve in the world along with second largest coal reserve and eighth largest oil reserve  Russia is the worlds leading net energy exporter and a major supplier to the European Union  Russia is largely undeveloped in terms of renewable energy but has geothermal stations used for heating and electricity in the north and east

13.  The Druzhba Pipeline is the longest oil pipeline in the world, carrying oil from southeast Russia into Belarus, Hungary, Ukraine, Poland, Slovakia, the Czech Republic and Germany.  It is operated by Transneft in Russia, Gomeltransneft Druzhba in Belarus, UkrTransNafta in Ukraine, PERN in Poland, Transpetrol in Slovakia, Mero in the Czech Republic and MOL in Hungary.  The word “Druzhba” means friendship, as the pipeline was initially intended to supply energy to many of the poorer countries in the former Soviet bloc. Currently, the Druzhba Pipeline has a capacity of 1.2 to 1.4 million barrels per day, but work is in progress to increase this in the section between Belarus and Poland.

14.  Gazprom used to be a Russian ministry before becoming a private company, and it remains very closely connected to the state - Russian President Dmitry Medvedev is a former chairman of the company.  Gazprom controls about a third of the world's gas reserves and it is responsible for a quarter of Europe's supplies.  Critics say that Russia is using its energy resources as a political weapon to pressure European and former Soviet countries to adopt favourable stances towards Moscow.

15.  http://www.youtube.com/watch?v=RMeoN9I9 1cY&feature=related http://www.youtube.com/watch?v=RMeoN9I9 1cY&feature=related  http://www.youtube.com/watch?v=GVIIr0wpz ZE http://www.youtube.com/watch?v=GVIIr0wpz ZE  http://www.youtube.com/watch?v=PaQYqojr hz8&feature=related http://www.youtube.com/watch?v=PaQYqojr hz8&feature=related

16.  2004 – Ukraine ousts the pro-russian government in favour of one with links to the west.  2006 – During the winter Russia raises gas prices by 400% arguing this reflected market prices  Ukraine refuse to pay and supply cut off  2008 – Gazprom cut off 50% gas supply claiming the Ukraine owed then $1.5 billion in unpaid gas (Ukraine had applied to join NATO)  In 2009, gas supplies were completely halted from 7 January, after Russia accused Ukraine of siphoning off gas meant for European customers, leaving more than a dozen countries without their expected supplies of Russian gas.

17.  http://www.youtube.com/watch?v=_dMgGzN uYE4 http://www.youtube.com/watch?v=_dMgGzN uYE4

18.  For many European countries 80% of their gas comes through the Ukraine so it was also cut off.  Some, like Bulgaria, Serbia and Bosnia, are almost completely dependent on supplies via Ukraine and so were left with major shortages, during a very cold spell in Europe.  In the meantime European countries had to shut down industrial plants and domestic heating systems, find alternative sources of gas or switch energy plants to oil. Schools were shut and people had to revert to using log fires to heat their homes.

19.  2007 - Belarus cut off Russian Oil pipeline in retaliation for rising prices being charged by Russia (this pipe carried 25% of Germany’s and 96% of Poland’s needs)  2009 – Belarus cuts off as Gazprom cuts gas.

20.  The EU has major concerns about security of supply and is moving ahead with a pipeline plan of its own. Nabucco will bring gas from Central Asia and the Caspian across Turkey into the European Union. But it will have only enough capacity to provide a small proportion, perhaps 5%, of Europe's needs.  Russia is itself building two new pipelines to avoid Belarus and Ukraine to try and raise confidence in supply.

21.  Russia facing high costs to extract its gas  Gazprom $40 billion in debt  New sources have been discovered ie North Sea Gas  Oil still a major player – supplying over 50% of EU markets in Hungary, Slovakia, Finland, Poland, and Czech Republic.