Independent Strategic Analysis of Australia’s Global Interests

Other FDI Reports SWA Articles

What’s Next for Jakarta Governor-Elect Anies Baswedan?

Anies will look towards fulfilling his policy promises to prove his worth as a presidential candidate. The success of religious tensions in propelling him into power could also be utilised again.

Canada Leading the World in Carbon Capture and Storage for Coal-Fired Power Stations

The Boundary Dam Power Station in Canada is claimed to be the first coal-fired power station in the world to successfully use carbon capture and storage technology on a commercial scale. Is this an example that Australia should be following?

Ahok Wins First Round of Jakarta Elections

While Ahok has a number of obstacles he must overcome to win the second round, success would humiliate hardline Islamist groups and empower the Indonesian President.

OPEC Debates Oil Production Cut

Speculation continues to mount that a deal to cut oil production can be reached when OPEC producers meet in Vienna on 30 November, but any agreement still faces major hurdles, with Iran and Iraq showing signs of resistance and the Saudi-Iranian rivalry may also come into play.

Marrakech: The Next Step in an Increasingly Active Process to Combat Climate Change

It remains to be seen if COP22 will achieve the necessary actions, the outcome of which may take many years to confirm.

South Africa: No End in Sight to Strained Electricity Grid

4 February 2015 | Other FDI Reports SWA Articles

The South African economy will continue to suffer as a result of unplanned power outages and the need for continued rolling stoppages. The crisis will deter foreign investors and may also render President Zuma’s ambitious plan for economic growth of five per cent by 2019 unachievable.   Background South African electricity supplier Eskom is struggling more...

Tanzania in Battle to Tackle Corruption that Hinders Energy Plans

3 December 2014 | Other FDI Reports SWA Articles

The Public Accounts Committee (PAC), formed to plug the haemorrhaging of public monies, has presented a report accusing key energy companies of malpractice. In response, the international community is threatening aid withdrawals if action is not taken, vindicating the warnings of PAC Chairman and opposition spokesman, Zitto Kabwe. Background Since independence, Tanzania has been dogged...

India Taking Steps to Transform its Coal Industry

26 November 2014 | Other FDI Reports SWA Articles

India plans to transform its coal industry with denationalisation and by confronting the corruption within the sector. The transformation is not complete, however, as the state continues to protect its virtual monopoly on this critically important, yet stagnant, sector. Background The Indian Supreme Court ruled on 24 September that 214 of the 218 coal blocks...

Falling Oil Prices Threaten Iran’s Nuclear Programme

5 November 2014 | Other FDI Reports SWA Articles

Falling oil prices and the threat of sanctions have given the P5+1 (the five permanent members of the UN Security Council and Germany) greater negotiating power in their talks with Iran. Iran needs to reach an agreement by 24 November to avoid further sanctions on its economy, which is already suffering from a combination of...

The Economic and Strategic Goals of Modi’s Energy Reforms

5 November 2014 | Other FDI Reports SWA Articles

The removal of India’s diesel subsidies caused a price drop, bringing it in line with global prices. On the other hand, increased gas prices will drive new capital investment and could be used to subsidise state-owned oil and gas projects, some of which are in the South China Sea. Background The global price of crude...

Coal Seam Gas Mining on Agricultural Land – The Fork in the Road for Australia’s ‘Transitional’ Economy?

5 November 2014 | Other FDI Reports SWA Articles

The recently-released Agricultural Competitiveness Green Paper outlines the concerns of farmers over the impact of mining operations in agricultural areas. As Coal Seam Gas (CSG) operations intensify in rural areas of Queensland and New South Wales, the federal government must back the paper’s commitment to protect the sustainability Australia’s farmland and water assets. Background CSG...

India Takes Steps to Transform its Coal Industry

29 October 2014 | Other FDI Reports SWA Articles

India plans to transform its coal industry by denationalising and eliminating the corruption within it. The transformation is not complete, however, with the state still protecting its virtual monopoly on this critically important yet stagnant sector. Background On 24 September the Indian Supreme Court ruled that 214 of the 218 coal blocks allocated to private...

Oil Oversupply Highlights Discord within OPEC

15 October 2014 | Other FDI Reports SWA Articles

Oversupply, slowing demand, a strong US dollar, and OPEC discord as to what to do about these factors are culminating in sliding oil prices. Wealthy Gulf states, including Saudi Arabia, will likely push to maintain current output and oil prices will continue to slide. Background The price of oil is at a multi-year low. A...

India’s Nuclear Co-operation with Global Institutions could Presage a New Nuclear Alignment with the West

On 1 October Indian delegates met their American counterparts in Washington to restart the stalled nuclear co-operation between the two countries. The development comes as part of a positive global response to India’s growing nuclear transparency. Background The United States and India have convened a new Contact Group charged with navigating the technical and legal...

Mutual Benefits in the Bay of Bengal

24 September 2014 | Other FDI Reports SWA Articles

Bangladesh is in a position to benefit greatly from generous Japanese loans and expertise, as Japan exercises its BIG-B initiative in the Bay of Bengal. This plan is the gateway to a proactive foreign policy for south and south-east Asia, focused on trade and development. Background The common energy trend in developing countries shows demand...

Risk and Opportunity in Mozambique Natural Gas Sector

17 September 2014 | Other FDI Reports SWA Articles

Mozambique must prioritise legislative reforms, including transparency, to balance domestic needs and the interests of foreign businesses. Its ambitious LNG export development has a market, but should be insulated from potential domestic issues, such as corruption and civil conflict. Background Proven gas deposits in Mozambique have skyrocketed in recent years, up from 4.5 trillion cubic...

Australia set for Uranium Exports to India after Talks between Prime Ministers

10 September 2014 | Other FDI Reports SWA Articles

Australia’s agreement to export uranium to India will be a major boost for both Australian exports and Indian civil nuclear development. India is seeking to move away from costly fossil fuels, especially highly-polluting coal-based imports, towards a more balanced and robust energy mix, including a civil nuclear programme. Summary Australian Prime Minister, Tony Abbott, and...

Oman-Iran Pipeline Deal Complicates Gulf Relations

10 September 2014 | Other FDI Reports SWA Articles

The Oman-Iran natural gas pipeline deal is a complication for Saudi hegemony in the Gulf, but it is helping to satisfying Omani energy needs. The cautious political manoeuvring aids Oman’s economic and security interests, without hugely violating the interests of Saudi Arabia and the United States, but it will not help to ease the regional...

Jordan Attempts to Address Energy Insecurity

3 September 2014 | Other FDI Reports SWA Articles

The Jordanian Government is showing initiative in seeking to reduce the country’s energy dependency. With energy demand expected to double by 2030, a national strategy to develop a domestic energy supply has been implemented and appears to be on-track. Background Unlike some of its neighbours, Jordan enjoys no significant hydrocarbon reserves. Estimates put proven oil...

Oil in the Seychelles: A Delicate Economic and Environmental Balancing Act

Anticipating the discovery of commercial quantities of oil, the Seychelles has introduced legislation that aims to ensure that wealth flows back to its Government, while it is also managing the challenges of balancing the needs of the resources and tourism sectors. If successful, it is an approach that will help it to avoid the “resource...

Mozambique: Natural Resources to Provide Catalyst for Further Development

Large reserves of natural resources in Mozambique are attracting foreign investment, which is expected to boost the already-growing economy. Upcoming elections and equitable development will play key roles in maintaining the political stability that is needed for investor confidence. Background After a decade-long civil war, Mozambique was one of the world’s poorest countries. Now, however,...

Back in Business: Indonesian Mines to Resume Production after Deal is Struck

A deal between the Indonesian Government and mining company Freeport will see many of Indonesia’s largest mines resume production. While the news is a win for the government, the outlook for mining companies once president-elect Joko Widodo takes office in October is not yet assured. Background Indonesia has reached a deal with PT Freeport Indonesia,...

Zimbabwe May Be Able To Capitalise As South African Economy Slows and Mining Strike Continues

The ongoing mining strike is weakening the South African economy and reducing the ability of the government to implement measures designed to address continuing social and economic disadvantages. In addition, it increasingly has the potential to turn investors away from South Africa.  Background If the platinum miners’ strike in South Africa continues, it may create...

Oman: India’s Answer to an Energy Supply Crisis?

India’s recent interest in establishing an underwater energy pipeline with Oman comes out of the blue, considering that the initiative failed some 21 years ago. There are, however, new motives behind the renewed interest. Background The history of the Oman-India underwater pipeline project dates back to 1985, when the two states signed an agreement to...

Iran and Russia Increase Nuclear Co-operation despite Regional Protests

Russia has committed itself to assisting Iran in building eight nuclear reactors. The deal has sparked concern, particularly in Saudi Arabia and Israel, over growing Iranian power in the region. Background Iran continues to develop its nuclear programme, angering both Saudi Arabia and Israel, which believe that it is intended for military application. The programme...

Not For Shale? India Wary Of New Energy Source

India faces the prospect of energy scarcity. While the advent of shale energy could provide a solution, the development of shale gas can bring complications, especially for water resources. Background Energy scarcity is among the many challenges confronting India and there is the prospect of it getting worse in the future. The phenomenon of shale...

Renewable Energy: Renewed Economic Hope for Bangladesh?

Bangladesh’s recent advancement in solar panel installations has led to it becoming one of the world’s leading countries in renewable energy jobs; however, there are some questions about its motives. Background Globally, the People’s Republic of Bangladesh is best known in two distinct areas: as devoted cricket contenders and a global hub for manufacturing (which...

Energy Issues in Pakistan – A Possible Looming Catastrophe?

= Pakistan today faces a dire situation in its energy sector, as the demand for energy outpaces supply. With an increasing national debt and no fix in sight, policy changes are critical to avoid catastrophic consequences. Background The State Minister for Water and Power of Pakistan, Abid Sher Ali, last week issued immediate orders to...

Somaliland: Reaping Recognition from Resources?

Somaliland has yet to be officially recognised as an independent country, but its new friend China has shown interest in mineral exploration there. Its resources sector could be what puts Somaliland on the map. Background On 8 April, the Somaliland Minister of Energy and Mineral Resources, Hussein Abdi Dualeh, welcomed a visiting delegation of Chinese...

Russia to Benefit Most From South African Mine Strike

Continuing strikes in the South African platinum and palladium mines are affecting the local economy and may create an international shortage of these metals, producing a windfall for the other main supplier, Russia. Background The South African economy is under increasing pressure due to the continuing strike by the Association of Mineworkers and Construction Union...

Mozambique: Civil Society Groups Demand an End to Tax Exemptions for Mega-Projects

4 September 2013 | Other FDI Reports SWA Articles

Increasing opposition from civil society groups to the tax exemptions given to mega-projects in Mozambique could signal increased taxes for foreign investors in the short-to-medium terms. Background Civil society groups in the town of Namaacha, located in Mozambique’s Maputo province, staged a protest on 28 August. Demonstrators were demanding an end to tax exemptions for...

Kenyan MP warns Mining Company to Employ Locals or Face Demonstrations

Mining companies need to ensure that they are perceived as offering fair recruitment opportunities for local residents in Kwale County otherwise civil unrest is likely to occur. Background The MP for Matuga Constituency in Kenya’s south west Kwale County, Hassan Mwanyoha, has called on mining companies in the county, including Base Titanium Limited (a subsidiary...

Possibility of Oil Discoveries Fuels Land Disputes in Kenya

Tensions could escalate further and result in violent unrest, if the Kenyan Government does not assist in the demarcation of land boundaries in the lower Cheptebo area of Kerio Valley. Background Tensions are currently high in the lower Cheptebo area of the Kerio Valley, a branch of Kenya’s Rift Valley province. Three clans are claiming...

Saudi Arabia Aiming to Be World’s Largest Renewable Energy Market by 2032

Although the world’s largest exporter of petroleum is aiming to be a leader in renewable energy by 2032, it will be a slow process. In the short-term, developments could be hindered by institutional and structural constraints. Background Saudi Arabia’s solar power plants currently produce only three megawatts of power at full capacity. Despite this, and...

Kenya Halts Issue of New Mining Licences

Kenya has announced that it will temporarily halt the issue of new mining licences until an audit of current legislation for the mining sector has been conducted. This is a positive move, which is likely to ease investor concerns. Background Kenya’s Cabinet Secretary for Mining, Najib Balala, announced on 25 July that the government would...

Malawi’s President sets Deadline for Resolution of Lake Malawi Dispute

It is unlikely that the dispute over the ownership of the lake between Malawi and Tanzania will be resolved in the short-term, despite a deadline set by President Joyce Banda. Background The dispute between Malawi and Tanzania over the ownership of Lake Malawi (known as Lake Nyasa in Tanzania) dates back to 1964, when Malawi...

Opposition Targets Key Road and Rail Routes in Central Mozambique

Mining interests in Mozambique are likely to experience disruptions to key road and rail routes in the central Sofala province, as opposition elements announce road and rail blocks. Background Heightened tensions continue between Mozambique’s ruling Front for the Liberation of Mozambique (Frelimo) and the opposition party, Mozambican National Resistance (Renamo).  In the most recent development,...

Leaders Call for the Democratic Republic of Congo and Uganda to Re-Demarcate their Border on Lake Albert

Tensions between the Democratic Republic of Congo (DRC) and Uganda have the potential to escalate, as civil society leaders of the two countries call for a joint border re-demarcation before oil exploration continues on Lake Albert. Background Leaders of groups participating in a NGO-facilitated dialogue in Uganda’s western Hoima District, have called on the governments...

Somali-Kenya Maritime Boundary Dispute Remains Unresolved

The postponement of offshore oil and gas exploration seems certain to continue, as Somalia rejects Kenya’s call to re-open talks on the demarcation of maritime boundaries. Background Political tensions have been heightened and offshore oil and gas exploration seems certain to remain stalled, as Somalia has rejected Kenya’s call to re-open talks to negotiate the...

Tanzania: Violent Demonstrations over Gas Pipeline Resume

Violent demonstrations are expected to continue in the Mtwara region of Tanzania as the government refuses to back down on constructing a gas pipeline from the area to the city of Dar es Salaam.  Background Tensions remain high in the southern Mtwara Region of Tanzania. The government has said that, despite recent protests, it intends...

The Removal of Fuel and Food Subsidies: What It Means For Resource Companies

Zambia’s decision to remove fuel and maize subsidies could put added pressure on the mining sector to appease social expectations. Background Zambia’s president, Michael Sata, has removed subsidies on maize meal and fuel, a decision which has angered civil society, particularly the young. Protests have since been held and, although these have not turned violent,...

Uganda’s Oil: Despite Progress in Resolving Disputes, Tensions Continue to Escalate

A decision to build an oil refinery is a positive step in several disputes between foreign oil companies and the government of Uganda; however, rising social tensions threaten to delay timely commercial oil production. Background Oil was first discovered in Uganda in 2006; however, commercial production has yet to begin. Oil companies and the government...

Zimbabwe’s Upcoming Elections and their Potential Impact on the Mining Industry

As Zimbabwe’s elections loom, its government considers imposing new taxes, including a tax on mining companies, to finance the poll. There are also concerns over a potential amendment to the indigenous laws. Although the latter is unlikely to be passed, the mining and resources sector is likely to face a period of uncertainty. Background Elections...

Protests Give Stark Reminders of Challenges to Investing in Mozambique

A recent protest that blocked access to a coal mine in the north-western Tete Province has highlighted a primary challenge that foreign companies face, that of managing and satisfying expectations amongst civil society. Background On 16 April, several hundred Mozambican protesters staged a peaceful protest and blocked access to the Moatize coal mine. The mine...

Ethiopia’s Potential to Continue East Africa’s Energy Surge

Joint reports from energy consulting firm Senergy and oil and gas exploration and production company SouthWest Energy, have identified Ethiopia as the newest potential energy hotspot in East Africa, with up to an estimated three billion barrels of oil in the Gambella and Jijiga basins. The region has remained largely unexplored, due to a long...

Fears of Instability as Tensions Escalate in Central Mozambique

Mozambique's President Armando Guebuza has warned that the country’s armed forces are prepared to respond to a series of attacks by militia sympathetic to the country’s main opposition party, the Mozambican National Resistance (RENAMO). Background The statement comes in response to increased tensions between the ruling Front for the Liberation of Mozambique (FRELIMO), and the...

Malawi Reiterates Call to take Tanzania to Court over Lake Malawi Dispute

Background The dispute between the two countries over ownership of Lake Malawi (known as Lake Nyasa in Tanzania) is not a new issue and dates back to 1964 when Malawi achieved independence. The argument between the neighbours has since resurfaced occasionally. Malawi refers to the Heligoland Treaty of 1890, to justify its claims of complete...

New Perth Wave Energy Project Begins

The Perth Wave Energy Project is ready to begin construction next month at the HMAS Stirling Naval Base and will become the world’s first functioning CETO Wave Energy System. Background Perth-based renewable energy developer Carnegie Wave Energy, in conjunction with the State and Commonwealth Governments, is about to commence construction of the Perth Wave Energy...

Tensions Continue between Japan and China over Disputed Islands

6 February 2013 | Other FDI Reports SWA Articles

The possibility of conflict remains, although the catastrophic damage it would do to both economies makes it unlikely. Background A tiny uninhabited island chain in the East China Sea, known as Diaoyu in China and Senkaku in Japan, is claimed by both countries. Tensions were heightened in September 2012 over the sale of three of...

Mali: Short-Term Victory, Long-Term Concern

30 January 2013 | Other FDI Reports SWA Articles

There are no immediate solutions to Mali’s long-term problems despite the success of current military operations. Background French and African troops appear on the verge of tactical victory in Mali. But is this likely to lead to a longer term solution, given the strong traditional differences between the lighter-skinned Arab-Berber population of the north and...

Construction Begins on South Stream Pipeline

12 December 2012 | Other FDI Reports SWA Articles

Construction of the South Stream gas pipeline began on 7 December, yet like many developments in the Russian energy sector the project has its complexities.  Background An energy consortium, led by Gazprom, has broken ground on a new pipeline that could supply a significant share of future European gas demand. The project will, however, face...

Northern Sea Route: Energy Highway?

5 December 2012 | Other FDI Reports SWA Articles

The reduced extent of the Arctic ice has made it possible for Atlantic energy to connect to Pacific demand. Background: Lower levels of Arctic ice, coupled with changing dynamics in the gas market, have opened access to the northern waters of Russia. Viability of the sea route, however, faces a number of challenges. We should...

Peru Oil Expansion Faces Challenges

28 November 2012 | Other FDI Reports SWA Articles

The Amazonian region of Peru has been highlighted as an area of oil potential, yet any development will be highly contentious.  Background Since late-October, oil majors have been competing for the opportunity to develop a hydrocarbon block in the Lorento region of Peru, located in the Amazon. Social and environmental considerations may, however, constrain development....

Canada and India Agree on Nuclear Cooperation Deal

14 November 2012 | Other FDI Reports SWA Articles

Ottawa and New Delhi have completed negotiations, commenced in 2010, to ratify a nuclear agreement. This may ultimately result in Canadian firms exporting uranium and nuclear infrastructure to the energy-poor South Asian state.  Background Canada has followed Australia and concluded a civil nuclear deal with India, which has been in development since 2010. The latest...

African Oil Boom Spreads to Somaliland

7 November 2012 | Other FDI Reports SWA Articles

While relatively more stable than Somalia, Somaliland will experience challenges in its attempts to transition to an energy producer. Background Somaliland has become the latest East African state to welcome hydrocarbon exploration. The semi-autonomous region hopes oil will stimulate economic growth. The government and potential producers, however, must not underestimate the challenges of development in...

Caution Required in Woodside’s Mediterranean Jaunt

31 October 2012 | Other FDI Reports SWA Articles

Border delineation, threats to critical infrastructure and poor regional security architecture could threaten Woodside Petroleum’s expansion in waters off the coast of Israel. Background As part of Woodside’s overseas growth, the Perth-based hydrocarbon producer has sought opportunities in the Leviathan field, located within Israeli waters. Security and political concerns will feature prominently in any future...

Energy Diplomacy to be Key Feature of Obama Administration

24 October 2012 | Other FDI Reports SWA Articles

Building allies’ capacity, countering energy challenges and fostering economic growth will be key features in a potential second-term Democrat Presidency.  Background In mid-October, Secretary of State, Hillary Clinton, suggested that, if successful in their re-election bid, the Obama Administration will aim to capitalise on US energy production. In reality, this will translate to increasing US...

Venezuelan Election: Continuing Politicisation of Oil Expected

17 October 2012 | Other FDI Reports SWA Articles

The petro-politics that have defined the tenure of President Chavez will continue with his re-election this month. Background Hugo Chavez will continue with his unique populist agenda after securing an additional five-year term as President of oil-rich Venezuela. This will result in increasing debt and criminalisation, impacting both the state and the national oil company....

Japan Benefits as Shale Revolution Moves East

10 October 2012 | Other FDI Reports SWA Articles

Japan is the latest state to announce oil discoveries using shale technology. While small in relative terms, the find is significant by other measures, and is indicative of broader policy trends from Tokyo.   Background Small oil deposits have been confirmed in northern Japan. Numerous challenges may prevent commercialisation; however, the on-going global shale development...

Multiple Internal Challenges for South Sudanese Oil Supply

Corruption, security, social discontent and lack of infrastructure will significantly constrain South Sudan’s oil producing capability. Background Much of the commentary on South Sudan’s post-seccession oil production has focussed on the dispute with Sudan. Signs suggest that September’s meeting between leaders from Sudan and South Sudan has produced a modus vivendi between the two parties....

International Naval Fleet Promotes Stability in Persian Gulf

26 September 2012 | Other FDI Reports SWA Articles

As tensions over Iran’s alleged nuclear programme reach a potential climax, an international naval armada is working to ensure stability.    Background An international naval fleet, involving ships from 30 nations, has conducted exercises that seek to meet a broad-range of contingencies in the strategically-vital Persian Gulf. While it is not officially targeting Iran, Tehran...

Saudi Arabia Could be an Oil Importer by 2030

19 September 2012 | Other FDI Reports SWA Articles

Economic and demographic trends suggest Saudi consumption levels may exceed production ratios within two decades. Background A report published by US-based financial services corporation Citigroup, has projected that Saudi Arabia could be forced to import oil by 2032. Economic and demographic growth, coupled with the Kingdom’s generous subsidy program, is driving demand to unsustainable levels....

Oil and Gas to Revive Trinidad and Tobago’s Economy

5 September 2012 | Other FDI Reports SWA Articles

The Government of Trinidad and Tobago hopes to arrest the decline of the island-nation’s economy by promoting opportunities in offshore oil and gas. Background The Global Financial Crisis has resulted in a significant decline in the economy of Trinidad and Tobago, with its GDP contracting by more than 4 per cent since 2010. To stimulate...

Asia Shields Iran from Sanctions – For Now

Background Asian demand is sustaining the Iranian regime against the full-force of sanctions. Attempts by the regime in Tehran to mitigate their impact, however, will be futile. The effect of sanctions may provide the stimulus for a renewed opposition movement that will be influential in the 2013 presidential elections.   Comment Undoubtedly, the Iranian regime is...

India’s Power Cut Tip of South Asia’s Energy Crisis

Background Chaos from power cuts is not limited to India; across South Asia, energy security is a policy challenge. Growing demand, with limited supply expansion, is likely to compound the problem. Although no easy task, regional integration and co-operation will be fundamental to resolving the issue, which could simultaneously provide the catalyst for closer economic...

Australia Signs Uranium Deal with UAE

Background In late July, Australia and the United Arab Emirates (UAE) reached an agreement on the provisions governing the export of uranium to supply Abu Dhabi’s nuclear energy programme. The UAE’s energy policy and security concerns are not unique, and are felt across the Middle East. In the future, therefore, it is likely that more...

Syrian Revolution: Implications for the Oil Sector

Background Recent commentary on the Syrian revolution has almost unanimously concluded that the regime of Bashar al-Assad is in terminal decline. It seems to be no longer an issue of if, but when, the Baathist rule will end. Syria’s modest production levels have protected the global oil market from potential ‘shocks’. Yet, Syria cannot be...

Afghanistan Releases Hydrocarbon Acreages

Background In July, the Afghan Mining Ministry announced the release of exploration rights for oil and gas developments in the state’s north-west. Extractive industries could provide Kabul with much needed revenue as it enters the next stage of its post-Taliban reconstruction period. The existence of resources, however, does not automatically translate to productivity. Geopolitical politicking,...

More Challenges than Opportunities in Emerging DRC Oil Industry

Background Africa’s oil industry is growing. Both off-shore and on-shore developments are projected to provide much-needed revenue for the Democratic Republic of the Congo (DRC). Yet fundamental challenges remain. After years of civil unrest and war, the security situation, both domestically and with its neighbours, remains tense. Violence continues, and more bloody conflict would undoubtedly...

More Challenges than Opportunities in Emerging DRC Oil Industry (2)

Background Africa’s oil industry is growing. Both off-shore and on-shore developments are projected to provide much-needed revenue for the Democratic Republic of the Congo (DRC). Yet fundamental challenges remain. After years of civil unrest and war, the security situation, both domestically and with its neighbours, remains tense. Violence continues, and more bloody conflict would undoubtedly...

New UAE Pipeline Circumvents Strait of Hormuz

Background In mid-June, Abu Dhabi opened theHabshan-Fujairah oil pipeline. The pipeline bypasses the Strait of Hormuz and will further erode Iran’s ability to impact the global oil market. It will significantly reduce dependence on the chokepoint of the Strait. Related insurance and transport costs are also likely to fall. The pipeline may also provide additional...

ChIndia: New Delhi and Beijing Energy Alliance Unlikely to Produce Outcomes

  Background The Chinese and Indian governments, along with energy companies from each state, have agreed, in principle, to collaborate in exploration and potential developments. Although welcomed in many quarters, and with obvious benefits, the co-operation is unlikely to yield palpable results. Convergence of interests, particularly those that pose a challenge to national goals, will...

Russia Fails to Increase Gas Exports to China

Background  In early June, President Putin paid a state visit to Beijing. Discussions were largely based on energy issues, but few tangible outcomes were achieved. An agreement between China and Russia to develop Siberian gas fields remains stalled. Ostensibly, price factors have proved a stumbling block. More likely, however, anxiety among policymakers in Moscow and...

Future of Iraqi Oil Unclear, Despite Positive Developments

Background  Ostensibly, last week’s auction of exploration rights to oil fields, combined with previous announcements of record high production levels, bodes well for Iraq. Yet Baghdad must resolve bureaucratic, security and infrastructure challenges to reach its full oil output potential and maximise its income.    Comment    On 30–31 May, in the latest sign of...

Energy Protest Litmus Test for Government in Burma

Background Despite its status as an energy exporter, Burma faces severe electricity deficits. This has encouraged segments of the population to take to the streets, taking advantage of the nascent programme of democratic reforms instituted over the last year. It is important, however, that the protestors are realistic in their aims. Fundamentally, the energy crisis...

Japan’s Post-Fukushima Energy Projections

Background Until the Fukushima Daiichi accident, nuclear energy was to play a vital role in Japan’s long-term energy policy. Growing opposition, however, has made this policy untenable. Prefecture governments and civil society groups have pressured the central government to reassess Japan’s energy future. Analysts contend that this concern has become one of the most important...

Race for Arctic Energy Resources Ramps Up

Background The eight members of the Arctic Council[1] are in a race to assert their territorial claims in the region. As energy needs grow, ownership of the area’s vast petroleum resources is becoming increasingly contested. In 2007, Russia planted its flag on the Arctic seabed, sparking a series of conferences, culminating in the Ilulissat Declaration....

Energy Developments and Security in the East Mediterranean

Background Traditionally a transit route, recent energy developments in the eastern Mediterranean suggest the region will increasingly yield greater returns and further energy prospects. Offshore basins adjacent to Cyprus, Egypt, Turkey and Israel, have the potential to significantly alter regional dynamics. Political and security considerations, however, may prevent large-scale development. Most recently, in late-April, this...

Argentina/YPF: Implications of Expropriation

Background In mid-April, in the largest nationalisation since Russia’s acquisition of Yukos in 2003, Argentina’s President, Cristina Fernández de Kirchner, seized a majority stake in the oil company Yacimientos Petrolíferos Fiscales (YPF). Sabre rattling and jingoistic rhetoric has increased dramatically in President Kirchner’s second term. The potential remains for further expropriations, particularly affecting the extractive...

United Kingdom Faces Emerging Energy Dilemma

Background The decision, late in March 2011, by energy utilities RWE and E.ON to abandon plans to develop the United Kingdom’s next generation of nuclear reactors, has created an emerging energy security challenge. London has proposed an expansion of natural gas sourced electricity to alleviate projected shortages. This brings accompanying challenges, however. To mitigate these...

Tajik Energy Policy Creates Regional Tension

Background In recent weeks, tensions have been rising in Eurasia. While the region is endowed with large reserves of water and energy, competition for reserves, and the associated influence, is pushing metropole, Uzbekistan, and regional minnow, Tajikistan, to the brink of conflict. The international community must push the governments of both states to establish a...

An Uncertain Future: The Iran-Pakistan Gas Pipeline

Background The long-proposed Iran-Pakistan (IP) gas pipeline continues to stall. Although Pakistan is facing an imminent energy crisis, for Islamabad, the project is caught up in the complexities of its relationships with Iran and the United States.   Comment Islamabad is of the view that securing funds for the construction of the Iran-Pakistan (IP) gas pipeline...

Al Qaida-Inspired Group Threatens Nigerian Energy Sector

Background The Gulf of Guinea is experiencing an energy boom, as major oil companies seek to capitalise on the region’s large reserves and relative stability, when compared to the Middle East. West Africa is not without security challenges, however. Boko Haram, a group with supposed links to al-Qaida, is challenging the stability of the Nigerian...

US Lacks “Strategic” Policy in Tapping Strategic Reserves

Background Washington is lobbying OECD countries to release their strategic oil reserves onto the international market; but caution is required in intervening in the oil market, as a drawdown could increase US exposure to oil shocks. Comment In mid-March, reports emerged suggesting that the British and US Governments had agreed in initial discussions to “tap”...

Indonesia Attempts to Improve Energy Security

Background Indonesia is an increasingly important member of the “Asian tiger economies”; with a six per cent growth rate in 2011, it has grown to be the largest economy in South-East Asia. In January 2012, that status was further bolstered as credit agencies raised Indonesia’s credit rating to investment grade for the first time since...

Energy Security Threatened by Refinery Closure

Background Caltex Australia has announced that a strategic review will consider closing two refineries on the east coast of Australia, potentially leaving just four refineries nationally. Consequently, national output could decrease from current levels of 761,500 barrels per day (bpd) to 433,000 bpd. Since 2003, Australia’s oil refining infrastructure has halved, bringing significant implications for...

Does Oil Represent the ‘Golden Bullet’ for Somali State Failure?

29 February 2012 | Other FDI Reports SWA Articles

Background Geological projections suggest Somalia may have large unexploited hydrocarbon reserves. Seemingly, this bodes well for the failed state, yet significant issues must be negotiated before they reach production.    Comment Analysts commentating on last week’s Somalia summit in London have suggested renewed focus on the ‘failed state’ is as much a result of realpolitik,...

Libyan Oil 2012: Prospects and Implications

15 February 2012 | Other FDI Reports SWA Articles

Background Libyan oil production has defied expectations and has already regained pre-revolution levels. While the nation’s “black gold” will provide much-needed revenue for the war-ravaged economy and infrastructure, considerable issues and challenges remain. These considerations should feature prominently as Libya enters the next stage in its post-revolution transition. Fundamentally, institutional reform is required, although doubts...

Developments Bode Well for Biofuel Sector

25 January 2012 | Other FDI Reports SWA Articles

Background Developments in, and growth of, “second generation” biofuels have provided increased viability for the sector. The Pilbara region has an existing capability to support projected growth in the industry. Scope, however, exists for the region to also play an enhanced role in both the consumption and production of biofuels. Comment According to a mid-January...

Western Resolve to Break Iran’s Oil Shield: Implications for Australia

18 January 2012 | Other FDI Reports SWA Articles

Background Iran boasts ten per cent of world oil reserves and is currently the third-largest exporter. This strategic share has allowed the Islamic Republic to create an “oil shield”, protecting the government’s survival and alleged nuclear programme. Recently, however, the United States and its allies have invoked strict sanctions aimed at removing Tehran from the...

Cyber-Security Challenges to Australia’s Hydrocarbon Sector

14 December 2011 | Other FDI Reports SWA Articles

Background The Australian hydrocarbon sector boasts an advanced emergency management capability. Oil and gas facilities, however, are highly vulnerable to deliberate targeting, particularly from cyber-operations. Hydrocarbon has a complex production and supply chain, including exploration; production; refining; storage; and transportation, which creates significant vulnerabilities. Industry commentators suggest that the threat posed to the sector is...

Uranium Could Take India Relationship beyond the Three “Cs”

23 November 2011 | Other FDI Reports SWA Articles

Background In an announcement on 15 November 2011, Prime Minister Julia Gillard proposed changes to Australia’s position on uranium exports to India. Despite attempts in the later stages of the Howard Government, India’s status as a non-signatory to the Nuclear Proliferation Treaty (NPT) has precluded the South Asian power from purchasing Australian uranium. The proposed...

India Seeks Energy Security from Thorium

9 November 2011 | Other FDI Reports SWA Articles

Background In early November 2011, India announced ambitious plans to exploit the nation’s abundant thorium reserves as a low-carbon, less radioactive, alternative to uranium. The new “safer” power plant, to come online by the end of the decade, will promote Indian energy autonomy and represents a significant opportunity, within which Australia should aim to create...

Olympic Win For Australia After Mining Approval

19 October 2011 | Other FDI Reports SWA Articles

Background In mid-October 2011, the Federal and South Australian Governments gave approval for a massive expansion of BHP Billiton’s Olympic Dam mine. When operational, the proposed 4 km long, 3.5 km wide and 1 km deep copper, gold and uranium mine will create 13,000 jobs and contribute $45 billion to the economy. Comment BHP Billiton...

Australia Primed to Benefit From Future Energy Demands

Background In mid-September, the United States’ Energy Information Administration (EIA) released a report outlining global energy trends to 2035. The report titled, International Energy Outlook 2011, forecasts a 53 per cent increase in global energy use over the coming decades. The changing nature and requirements of international energy demand present an opportune space for the...

Protectionist Mining Code in Guinea Highlights African Sovereign Risk

21 September 2011 | Other FDI Reports SWA Articles

Background In mid-September 2011, lawmakers in the West African republic of Guinea passed a radical new mining code, to increase government ownership of mining operations. Prime Minister Mohamed Said Fofana argued the legislation will curb corruption and stimulate development in the impoverished country. Analysts and mine operators, however, argue that the new laws are restrictive...

Trans-Tasman Opportunities from New Zealand Energy Strategy

7 September 2011 | Other FDI Reports SWA Articles

Background Australia must position itself to promote its strong energy credentials with New Zealand, as Wellington commits to the long-term future of hydrocarbons for energy production. Conversely, as Australia makes a greater commitment to renewable power generation, New Zealand can provide the requisite expertise and experience. Comment In late August 2011, the New Zealand Government...

Mozambique Open for Mining Business: Minister

7 September 2011 | Other FDI Reports SWA Articles

Background The Indian Ocean littoral state of Mozambique is making moves to capitalise on its underdeveloped resources sector. Although a small number of Australian miners are already active in the country, the Mozambican Government is aiming to attract more mining companies by finetuning its foreign investment regime.  Comment Speaking at day two of the Africa...

China Proposes Joint Exploration of Spratly Islands

Background China’s ambassador in Manila says his country is willing to negotiate partnerships with the Philippines and other claimants in disputed parts of the South China Sea. The announcement, made on the eve of Philippine President Benigno Aquino’s first state visit to China, could remove a significant regional flashpoint, promote good order along major strategic lines of communication and ensure future energy security. ...

Kimberley Proposed as Possible Tidal Energy Site

Background Plans to build a 100 megawatt tidal station in the Kimberley region of north-west Australia have been revived, almost ten years after the project failed due to cost blow-outs. In addition to providing a clean source of energy, the station has the potential to increase economic and social opportunities in the region. Comment In...

Deal Highlights Challenges and Opportunities for Australian LNG

Background In late July, troubled Japanese utility, Tokyo Electric Power Company (TEPCO) concluded a heads of agreement deal with American oil and gas super-major Chevron. In one of Australia’s largest resource contracts, TEPCO has agreed to purchase Liquefied Natural Gas (LNG) worth $70 billion from Chevron’s proposed Wheatstone project in the Pilbara, over the next...

Japan’s Energy Transition Provides Opportunities for Australia

Background In the aftermath of Japan’s Fukushima Daiichi nuclear emergency, the country’s largest electricity company has announced a greater emphasis on liquefied natural gas (LNG), providing joint venture opportunities for Australia and Japan.  Comment The newly appointed president of Tokyo Electric Power (TEPCO), Toshio Nishizawa, has forecast greater Japanese reliance on LNG, following the continuing...

Korea has Chance for Advanced Bio-Fuel Technology

Background The South Korean Government has funded a new 670 million won (₩) ($587,600) “Waste-to-Energy” plant near Seoul. The first plant of its kind, it is capable of supplying 6,500 cubic metres of bio-gas to the public transport fleet. The plant, opened on 16 June 2011, is the latest in a series of projects that...

Australia to be an Energy Superpower

Background The Environmental Protection Agency’s approval of the Wheatstone project will augment Australia’s position as a global liquefied natural gas (LNG) giant. Comment Australia’s attempts to replace Qatar as the world’s largest LNG exporter have been bolstered by last week’s Environmental Protection Agency (EPA) approval of the 25 million tonnes per year Wheatstone LNG project,...

Legislation Required in Fracking Debate

Background Hydraulic fracturing has gained prominence in Europe and America in recent weeks, with reports linking the process to earthquakes, environmental damage and illnesses. Co-ordinated State and Federal legislation is required to reconcile community concerns and development of the emerging shale hydrocarbon industry. Comment Australian mining companies and projects are involved in a growing international...

Australia’s Role in the Nuclear Renaissance

Background The announcements, made in late May, by the Swiss and German Governments that they will phase out nuclear power, are premature. Australia has the ability to be the voice of reason in the international nuclear debate and to advocate the merits of atomic energy for developing nations.   Comment Civil nuclear power has, until recently,...

Publication Guide

  • Associate papers are primary source assessments written by FDI associates. The assessment topics range from regional bilateral relationships and opportunities and challenges in our neighbouring countries.

  • Feature interviews are interviews conducted by an FDI Research Manager. Interview topics range from the sustainability of our planet to the improved provision of emergency food aid.

  • Normally issued in hardcopy, these represent a comprehensive study of one of FDI’s four research areas.

  • Strategic alerts are priority current intelligence items. We provide these alerts when events such as military deployments or foreign election results occur.

  • A 1500 to 3000 word, single topic assessment.

  • A number of short articles addressing current intelligence topics, issued each week.

  • A record of discussions resulting from a single, or series of, roundtable conferences.

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