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Estonian report
by Euro Reporter
2014-06-25 08:38:54
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Could Estonia's oil shale bolster Europe's energy security?

The SUV ride down the steep incline in Estonia's newest oil shale mine, the first to be built since the Soviet era, is bumpy. At 105 feet below ground, Larissa Puhilas gets out. She inspects the soft brown rock that's just collapsed, after miners drilled and blasted a limestone wall to release the brown sedimentary oil shale. Big conveyer belts will bring it outside to be crushed and burned to produce power or further processed into oil. An oil shale enrichment specialist, Ms. Puhilas is a player in one of Estonia's most important – and controversial – industries. Unlike shale oil, the liquid obtained by hydraulic fracturing (fracking) miles underground, Estonia's oil shale is a sedimentary rock containing kerogen found close to the surface. Estonia is the only country in the world whose energy sector depends on oil shale. In fact, practically all its electricity comes from the rock. And with European countries seeking to reduce their dependence on imports of Russian gas, Estonia's energy self-sufficiency is suddenly drawing attention. “Thanks to you, Estonia is currently one of the least dependent countries on the import of energy in the European Union,” Estonian President Toomas Hendrik Ilves told miners last year when the mine opened some 40 miles from Narva, on the Russian border. “This in turn is an Estonian security and independence matter.”

Since discovering that shale could power its locomotives in the early 1920s, the tiny Baltic state has become a world master in mining and processing the fossil fuel. “We are one of the few countries producing our own electricity and even exporting it – in today's world, it is important,” says Peeter Eek of Estonia's environmental ministry, alluding to Russia's political use of its gas resources. “We have to balance our social, economic, and environmental interest.” Over the past century, the oil shale industry has given Estonia a unique profile. It fed Germany's World War II apparatus, and heated Leningrad and Tallinn in Soviet times, when the construction of two huge oil-shale power plants in Narva – still the world's largest – spurred massive immigration from other Soviet republics. “During Soviet occupation, oil shale became the technology of Estonia, a way to manifest Estonian-ness," says economist Rurik Holmberg of the Swedish Energy Agency. The industry suffered when the Soviet market collapsed in the 1990s. But with 18 million tons of the rock mined this year (compared with 30 million tons in the industry's heyday in 1981), Estonia's energy industry, concentrated in its Russian-speaking northeast, generates enough power for the country's 1.3 million inhabitants. It exports more and more of it to Finland, Latvia, and Lithuania, too.

“Here it's easy to mine, and that's the reason we succeeded,” says Andres Mäe, an Estonian energy analyst. But while oil shale "gives Estonia a certain energy independence," Mr. Mäe adds that "it's very dirty." The processing of oil shale creates tons of carbon dioxide and huge amounts of waste that ends up in "ash hills" in the countryside.  “The big question is: How much shale mining do we allow? “Says Mr. Eek of the environmental ministry. “We are looking at how to reduce the impact on the environment at each stage, from mining to processing.” Estonia's accession to the EU forced it to deal with the industry's environmental impact. That led to “impressive” steps to diversify its energy mix, limit shale mining, and invest in technology, says Thea Khitarishvili of the International Energy Association Agency in Paris. For example, she says, a new refinery built by state-owned Eesti Energia can use the gas released in processing oil shale to also produce electricity. But that's not enough, says Valdur Lahtvee of the Stockholm Environment Institute in Tallinn. It "makes using the oil shale more efficient, but oil shale remains the carbon-richest fuel in Europe.” He calls for dropping oil shale, arguing that Estonian can get all its energy from bio mass and wind. Estonia hopes to export its pioneering oil shale technology abroad. One hurdle is that although the tiny country knows its own oil shale well, the nature of oil shale reserves elsewhere – Jordan, the US, Australia, and others have substantial deposits – has been little studied. Many countries' oil shale is much harder to access than Estonia's.

And while oil shale is relatively attractive now – it is currently cheaper than alternatives like oil, natural gas, and renewable energy sources – that could change, particularly if the European Union adjusts its climate change policy. Under the EU's “cap and trade” policy, polluting companies in the EU need to buy carbon credits, effectively making dirty fuels like oil shale more expensive. Lately, prices for those permits have been dropping, lowering the incentive for companies to use cleaner energy and making oil shale more cost effective. “CO2 quotas are not strict anymore,” says Mäe, the energy analyst. “But that could change once the recession is over." Mr. Lahtvee predicts that the EU is soon going to raise carbon credit costs, which would make it too expensive for oil shale companies to continue spewing high levels of dirty gases. ”Soon oil shale will lose its competitive edge,” he says. The best option, most experts agree, is to make the industry cleaner, not to drop it – and not just for energy security reasons. The industry is also the lifeblood of a predominantly Russian region near the Russian border, where blue collar jobs are hard to find. “Keeping oil shale [grants] not only self sufficiency in energy, but also avoids any potential social problem in Estonia's northeast,” says Rurik Holmberg, a former OECD observer in Narva. To end the oil shale industry would be to end many jobs for Narva's community. That could stir social unrest and, potentially, Russia's interest in intervening in the region. “Estonia needs the oil shale-based energy sector for its overall security.”


Estonia PM calls for permanent NATO presence as Bulwark to Russia

Estonian Prime Minister Taavi Roivas urged NATO on Friday to establish a permanent presence in the Baltic state in response to Russia's actions in Ukraine, telling his allies to “open your eyes and stay awake”. The Western alliance has tripled the number of fighter jets based in the Baltics as part of measures to beef up its defences in Eastern Europe following Russia's annexation of Crimea. The events in eastern Ukraine, where Russian-speaking insurgents using sophisticated weapons threaten to split the country, have put the whole former Soviet bloc region on alert and eager for NATO reassurance. Asked if he would like to see a permanent mission in Estonia, Roivas told Reuters in an interview: “Estonia, Latvia, Lithuania, Poland and Romania are the Border States, and it is only logical that air policing and air defence for example are present on the borders.”
NATO's top military commander, U.S. Air Force General Philip Breedlove, said last month that NATO would have to consider permanently stationing troops in Eastern Europe. But some NATO allies argue that permanent basing of large numbers of troops in the east is too expensive, not a military necessity and needlessly provocative to Moscow. Asked about the risk of antagonizing Moscow further, Riovas said: “Russia has done everything to break all agreements and has been very aggressive... we have the alarm bell ringing in Ukraine and I really believe that now is the time to open your eyes and stay awake.”
NATO has arranged a number of short-term army, air force and naval rotations in Eastern Europe, but these are due to finish at the end of this year. Long-term plans include training drills that will consistently keep about 100 U.S. elite troops on the ground at any one time in NATO states close to Russia, with teams working in several countries, a U.S. official said.


Estonia bans imported goods from Crimea

Estonia has banned imported goods from Crimea amid the Ukraine crisis, public broadcasting reports. The purpose of the restrictions is to put pressure on local companies to cooperate with the government of Ukraine, Estonian Foreign Minister Urmas Paet said: "The important message of this decision is that the European Union does not accept the annexation of the Crimea." he stated.

The Estonian government also approved restrictive measures against Sudan and South Sudan on June 19. The restrictions are necessary considering the situation there, Paet noted.

The final decision on the Crimean as well as Sudanese and South Sudanese sanctions will be made in the European Union on Monday, June 22 at the European Union foreign ministers meeting in Luxembourg.


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Emanuel Paparella2014-06-25 10:21:15
Judging from the above, it would appear that, thanks to Russia's annexation of Crimea and general disrespect for the Ukraine's sovereignty, NATO is not after all the anachronism from the past to be disbanded, as it seemed to have been argued in some quarters till recently. Indeed, to paraphrase Franklin, in the West democracy either will hang together or it will hang separately, one nation at a time...

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