Page 5 - FSUOGM Week 12 2021
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FSUOGM                                       COMMENTARY                                            FSUOGM
































                         the government says. Its resource base is the  launch in 2030. There is also Rosneft’s 4.3mn tpy
                         Severo-Obskoye field, currently estimated to  Pechora LNG project, also in the far north. This
                         hold 273.6 bcm in C1+C2 reserves.    project has been frozen since failing to secure an
                           Another, somewhat unique project is Yakutsk  export licence, and the government is not fore-
                         LNG, slated to be built on the mainland shore  casting a launch date.
                         of the Russian Far East. It is unique first of all   Other, even more distant, prospects include
                         because it is led by a relatively small gas company  Gazprom’s 30mn tpy Shtokman project,
                         called Yakutsk Fuel and Energy Co (YATEK),  expected online no earlier than 2035, and Ros-
                         owned by investment group A-Property, rather  neft’s 30mn tpy Kara LNG and 35-50mn tpy
                         than one of the main players in the Russian gas  Taymyr LNG ventures, forecast to be up and
                         market. Secondly, the terminal will be built far  running in 2030-2035. Rosneft’s Far East LNG
                         away from available gas supply, requiring the  could also undergo a 10mn tpy expansion by the
                         construction of a 1,300-km pipeline. The gov-  late 2030s, according to the government.
                         ernment’s programme envisages Yakutsk LNG   There is considerable uncertainty about the
                         commencing operations in 2026-2027, based  pace of Russian LNG development, given the
                         on 820 bcm of initial gas-in place.  doubts about how feasible some of these ven-
                           Next there is the 6.2mn tpy Far East LNG pro-  tures are. The government projects that national
                         ject, backed by Rosneft and its US partner Exx-  LNG output could reach between 46 and 65mn
                         onMobil. Rosneft has been trying to develop its  tonnes by 2024, rising to 63-102.5mn tonnes by
                         own liquefaction capacity for many years with-  2030. By 2035, production could range from
                         out success. Far East LNG is expected online in  anywhere between 80 and 140mn tpy.
                         2027-2028, but the project is yet to reach an FID.  The government's programme is also aimed
                           Another in the line-up is the 13.3mn tpy Ust-  at expanding the use of LNG for gasification.
                         Luga LNG project led by Gazprom. That facility  Given its size, Russia has had difficulty provid-
                         is due on stream in 2024-2025, relying on some  ing gas to energy consumers in its more remote
                         9.5 tcm of AB1+B2 reserves in Western Siberia.  and sparsely populated regions. LNG, which can
                         The venture suffered a setback earlier this month  be trucked to these consumers on a small scale,
                         when Gazprom cancelled an engineering, pro-  offers an alternative to costly pipeline construc-
                         curement and construction (EPC) contract for  tion. Speaking at the government meeting in
                         its gas processing facilities.       which the programme was approved, Deputy
                           The programme also mentions a 5.4mn tpy  Prime Minister Alexander Novak said small-
                         expansion project at Gazprom’s Sakhalin LNG,  scale LNG supply could be used to gasify the
                         even though this venture has made seemingly  regions of Yakutia, Karelia, Amur, Murmansk,
                         little progress in over a decade. The terminal will  Leningrad, Pskov, Tomsk, Kemerovo and
                         run on gas from the offshore South-Kirinskoye  Irkutsk.
                         field, whose development has been on hold since   Russia is about to embark on a RUB1.9 tril-
                         the US applied sanctions to the deposit in 2015.  lion ($25bn), 10-year gasification programme,
                         The government does not anticipate its launch  aimed at expanding the share of the population
                         before 2027.                         with access to gas from the current 70% to 83%.
                                                              Earlier this month, Russian Prime Minister
                         Longer term                          Mikhail Mishustin said small-scale LNG supply
                         Moving to the longer time frame, Gazprom  was a favourable solution for gasification in areas
                         wants to develop a 20mn tpy export facility on  like the Far East. Only 18% of consumers in the
                         the Yamal peninsula, using resources at the Tam-  Far East have access to gas supply, which is three
                         beyskoye field. The government envisages its  times less than the national average, he said. ™



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