Page 5 - FSUOGM Week 37

FSUOGM COMMENTARY FSUOGM

Construction of a
cryogenic filling
station on a highway
between Moscow and
St Petersburg. Source:
Gazprom.

30% of the bill. What is more, Gazprom will Rosneft too wants to get in on the game.
bear a further 30% of the cost, leaving the owner Its CEO Igor Sechin recently discussed plans
responsible for only 10%. to build several CNG stations in the Moscow
Small to mid-sized businesses and private cit- region with local authorities.
izens can benefit from these subsidies, originally All in all, the government is looking to allo-
proposed by the energy ministry and strongly cate some RUB19.3bn ($260mn) of budget funds
backed by Gazprom. Businesses and entrepre- to developing the NGV sector over the next five
neurs will also enjoy a 10% discount on a limited years. Even greater sums could become available
amount of gas fuel for one year. if Gazprom gets its way.
The government issued another decree ear- Sales of gas as a vehicle fuel are expected to
lier this month that introduces rules for grants reach 2.7bn cubic metres annually by 2024, while
for the construction of small-scale LNG produc- the number of filling stations will be expanded to
tion and refuelling infrastructure. Tenders will 1,273, under the government’s strategy. By 2030,
be held to select investors. Less substantial sub- some 24% of Russian vehicles will run on gas and
sidies have been available to developers since last other alternative fuels. At present, only 2% use
year but have been judged as ineffectual. gas, including 0.4% of cars, 3.6% of trucks, 11%
The aim is that the new programme will lead of light commercial vehicles and 14.4% of buses.
to almost 80 new LNG filling stations popping CNG is seen as better suited for cars and light
up along key highways mostly in European cargo vehicles, whereas the target for LNG is
Russia. trucks, railway and waterborne transport, as well
Automakers are also set to receive support to as mining and agricultural equipment.
build gas engines, including discounted rates for For a large-scale NGV market in Russia to
equipment. But the details are yet to be ironed become a reality, all parts must make progress
out. together. There must be infrastructure in place to
encourage motorists to make the switch and for
The next steps automakers to manufacture gas engines. Like-
Russia currently has some 484 filling stations in wise, infrastructure developers need enough
service, the number having doubled over the last NGVs on the road and automakers need enough
seven years. Almost all of these are compressed demand for their products.
natural gas (CNG) stations, whereas the LNG Another challenge that needs to be over-
vehicle sector is at a much earlier stage. come is a negative attitude towards NGVs from
Some 329 of the stations are owned by Gaz- consumers. In a survey carried out recently by
prom, but the government is hoping to attract Russian analytics centre NAFI, 59% of motorists
more private investors to the sector as well. said they were not willing to switch to gas from
Novatek, Russia’s largest independent gas sup- gasoline or diesel, even with compensation from
plier, is looking to join the market. It recently the state. The main reason was concern about the
opened a small-scale liquefaction plant in Chely- safety of the vehicles. This image problem will
abinsk that it says will supply regional motor fuel. have to be addressed. ™

Week 37 16•September•2020 www. NEWSBASE .com P5