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Nord Stream 2 gas pipeline to Germany, in a planning phase for a second pipeline to China,
last-ditch attempt to prevent the project’s com- and also revealed last week it had resumed devel-
pletion. US Senators Ted Cruz, a Republican, opment studies for the offshore Shtokman gas
and Jeanne Shaheen, a Democrat, are reportedly field in the Russian Arctic – a project it tried to
to be planning to introduce a bill this week on advance for more than a decade before shelving
new measures. in 2013.
Further US pressure is unlikely to make a Gazprom’s reappraisal of the high-cost and
difference at this stage. Sanctions imposed by challenging project is oddly timed, given that Russia’s
Washington last December led to Swiss-based global gas prices are at their lowest level in
contractor Allseas abandoning the pipeline, with decades. Gazprom, by far
just 6% of its offshore section left to complete. An investigation by Russian news outlet Europe’s biggest
Russia is preparing to finish the job with its own Lenta.ru has meanwhile cast doubt on Gaz-
pipelaying vessel, which is currently moored at prom’s ability to deliver on its existing supply gas supplier,
a German port. It is hard to see how additional commitments to China. The report claimed the
sanctions could therefore thwart construction. company risked losing $20bn and would strug- has also cut
Washington could threaten measures against gle to fulfil its 2014 supply deal with China’s
companies hoping to buy gas supplied by Nord CNPC after overestimating the capacity of its shipments via
Stream 2. But Germany would strongly oppose production sites in Eastern Siberia. other routes
such a move, viewing it as US interference in In Kazakhstan, Chevron has announced that
what Berlin has insisted is “a purely commercial 20,000 workers or two thirds of the workforce including
project.” at the giant Tengiz oilfield will be demobilised
following a COVID-19 outbreak. The move will Ukraine.
If you’d like to read more about the key events shaping likely affect work on an expansion project, which
Europe’s oil and gas sector then please click here for is already running a year behind schedule.
NewsBase’s EurOil Monitor.
If you’d like to read more about the key events shaping
Further Russian losses the former Soviet Union’s oil and gas sector then please
Gazprom Neft has become the latest Russian oil click here for NewsBase’s FSU Monitor.
and gas producer to post a net loss for the first
quarter on low prices and ruble devaluation. LNG giant pushing ahead as others hold
Rosneft and Novatek also slipped into the red back
for similar reasons. Even as US LNG exports decline, the backers of
While blessed with low production costs, the Golden Pass LNG project, which is under
Russian companies are having to cut their cap- construction in Texas, have requested author-
ital expenditure to protect their earnings, much isation to expand the capacity of the terminal.
like their international peers. After all, the profits This is perhaps not surprising considering the
of state firms serve as a key source of revenue for project is majority-owned by Qatar Petroleum
the Russian government. VTB Capital expects (QP), which is also aggressively pursuing the
Gazprom Neft to reduce its full-year overall cap- expansion of its domestic LNG export capacity.
ital expenditure by around 25% from its initial QP owns a 70% stake in Golden Pass LNG, while
guidance, to RUB335bn ($4.8bn). ExxonMobil holds the remaining 30%.
Despite the market collapse, parent company The partners are seeking permission to
Gazprom is counting on strong gas demand boost the capacity of Golden Pass LNG to
growth in the long run. It recently launched the 18.1mn tonnes per year (tpy), from 15.6mn

Week 22 04•June•2020 www. NEWSBASE .com P17