Page 21 - FSUOGM Week 22

FSUOGM PROJECTS & COMPANIES FSUOGM
Gazprom looks again at Arctic gas project
RUSSIA
The Shtokman field holds an estimated 3.9 trillion cubic metres
of gas.
RUSSIA’S Gazprom has carried out a study on the development of the giant offshore Shtok- man field in the Arctic – a project it was trying to advance for over a decade before shelving in 2013.
Gazprom’s design unit, Gazprom Proyekti- rovaniye, said on May 27 it had researched an adjusted plan to develop the field. It did not dis- close any details about the study.
Shtokman was discovered by Soviet geolo- gists in 1987 some 600 km north-east of Mur- mansk in the Barents Sea, in waters up to 340 metres deep. It is one of the world’s largest off- shore gas finds, with Gazprom estimating its size at 3.9 trillion cubic metres.
Gazprom partnered up with France’s Total and Norway’s Equinor to exploit the field in 2007, and the group had aimed to take a final investment decision (FID) on a $15bn develop- ment plan in 2009 and start production in 2014. The project was to involve the construction of a 7.5mn tonne per year (tpy) LNG export terminal under its first stage.
The partners struggled to agree on develop- ment terms, however. The harsh operating envi- ronment at Shtokman and its remote location also posed obstacles. Another issue was the fact that some of the field’s gas had been expected to be shipped to US, but the shale gas revolution in
Texas and North Dakota put an end to this plan. Equinor, then known as Statoil, exited the project in 2012.
Gas prices then collapsed in 2014, and the following year France’s Total withdrew from the venture as well. Even before the price crash, Gaz- prom had suggested that Shtokman might be left for “a future generation.”
When Gazprom revised its offshore strategy in 2017, it targeted Shtokman’s launch in 2028. The following year the Russian Energy Ministry forecast an even later date of 2035.
Gazprom’s reappraisal of the high-cost pro- ject is oddly timed. Global gas prices are at their lowest level in decades as a result of coronavirus (COVID-19) lockdowns and a glut in global LNG supply. Gazprom has also recently begun pre-investment design and survey work for an even more ambitious plan to lay a second, 50bn cubic metre per year pipeline to China.
In its statement, Gazprom Proyektirovaniye said it had undertaken an additional pre-invest- ment study on the construction of a small-sized LNG liquefaction plant in Vladivostok. Gaz- prom had earlier wanted to build a 14mn tpy export terminal at the Far Eastern port, but it has since opted for a much smaller 1.5mn tpy plant. The project will provide bunkering services for mostly Chinese LNG-fuelled ships. ™
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