News Wrap

IN TODAY'S News Wrap: Santos lobbies for shale gas tax breaks; oil-rich eastern Libya unveils independent government; and US oil-carrying vessel attacked by Nigerian pirates.

Encouraging shale gas development

With the seeds of the US shale gas boom sown via a tax credit system that lasted until 2002, Santos vice-president of strategy Peter Cleary wants the Australian government to consider shale gas-related tax breaks.

"I think governments always look for the right balance between taxation and encouraging people to go out there,'' he said at the Economic Development of Australia forum in Adelaide yesterday, according to The Australian.

"I think America shows you that when you promote a system where there's fair returns available to all (and if) you encourage people to go out and there and take risk, then that will happen.''

Chatham House energy expert Professor Paul Stevens echoed similar views.

"Governments can't change geology, but they can change the commerciality of the geology,'' he told the newspaper.

"Tweaking the fiscal terms is quite a good way of doing it.''

Santos started commercial shale gas production in the Cooper Basin last year. Linc Energy CEO Peter Bond recently told EnergyNews that shale gas was Australia's next boom and would be a stronger boom than CSG.

Eastern Libya threatens to break off

An east Libyan political movement has formed a shadow government for the oil-rich region that they want to turn into an autonomous state called Barqa.

"The aim of the regional government is to share resources in a better fashion and to end the centralised system adopted by the authorities in Tripoli," recently declared Barqa government leader Abd-Rabbo al-Barassi said in a media conference, according to AAP.

The leader reportedly dismissed claims the movement only sought to take control of the region's oil resources while he also said the Barqa government did not have defence or foreign affairs portfolios.

The Tripoli-headquartered Libyan government has rejected the Barqa movement's declaration of self-autonomy, but is reportedly yet to comment.

Eastern militias managed to shut down three oil refineries in July while a Libyan air force colonel was reportedly shot dead on Thursday after leaving his home in Benghazi.

Barqa was the name for the region encompassing the present four provinces of Benghazi, Tobruk, Ajdabiya and Jebel Akhdar under the system created by King Idris in 1951.

Nigerian pirates

A US-flagged oil supply vessel has been attacked by pirates off the Nigerian coast, with the American captain and chief engineer kidnapped.

US defence officials have quickly ruled out terrorism, with pirates in this region typically releasing their kidnapped victims after a ransom is paid.

According to Reuters, security sources have revealed that Edison Chouest Offshore's 67m C-Retriever vessel was attacked by pirates early Wednesday.

The US State Department and FBI are reportedly leading the American response while the Nigerian Navy is also "taking action".

"We are concerned by the disturbing increase in the incidence of maritime crime, including incidents of piracy off the coast of West Africa, specifically in the Gulf of Guinea," White House spokesman Jay Carney reportedly said in a media briefing yesterday.

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