Page 90 - RusRPTNov18

Russia's largest natural gas producer and pipeline exports monopolist Gazprom will double down on one of its most ambitious pipeline projects of the last decades , investing about RUB900bn ($13.5bn) in the extension of Bovanenkovo-Ukhta and Ukhta-Torzhok pipelines from the Yamal Peninsula, Kommersant daily reported on October 10 citing unnamed sources. Reportedly, the projects will be approved in the government's critical infrastructure development plan until 2024. The Yamal gas fields will be the resource base for rising European exports and possible expansion of supplies to China . Ukhta-Torzhok will also supply gas to Nord Stream and future Nord Stream 2 pipeline to Germany . Kommersant r eminds that Gazprom's Yamal pipelines built in 2008-2011 were among the most expensive projects of the gas giant, costing about RUB1.8 trillion in current prices. The ambitious spending plans could further postpone dividend growth that is now seen possible after the investment program peaking out in 2020.
The government may oblige oil companies to supply at least 17.5% of the extracted oil to Russia’s refineries . Following the meeting on the development of the oil industry, Prime Minister Dmitry Medvedev instructed the Ministry of Finance, the Ministry of Energy, the Ministry of Economic Development and the Federal Antimonopoly Service to submit relevant proposals on adjusting the tax maneuver parameters by October 10. After the changes, the tax maneuver should include “obligations to supply oil to Russian refineries producing motor fuels that comply with the technical regulations for all oil producers not lower than 17.5%.” In addition, the maneuver parameters should include "mandatory requirements for the supply of petroleum products by oil companies to the domestic market, including the exchange". At the same time, the government wants to determine the procedure for establishing individual obligations for oil companies. FAS Igor Artemyev says that Rosneft already now supplies more than 20%.
Nord Stream 2 is 70% funded , TASS news agency quoted the head of Russian gas giant Gazprom, Alexei Miller, as saying on October 7. Nord Stream 2, which will double the capacity from the existing Nord Stream 1 pipeline from a current 55 billion cubic metres of gas a year, is owned by Gazprom, which is taking on half of the planned costs of 9.5 billion euros ($11 billion). The rest is divided between five European energy companies - Germany’s Uniper and Wintershall, Anglo- Dutch group Royal Dutch Shell, France’s Engie and Austria’s OMV.
Implementation of the Turkish Stream is on schedule - gas supplies via the pipeline might begin on January 1, 2020, Russian Energy Minister Alexander Novak said in an interview with Rossiya 24 TV channel. "As for the Turkish Stream, its construction is carried out according to the approved plans. As you know, intergovernmental agreement was signed between Russia and Turkey, a road map was approved and everything is on schedule, By January 1, 2020, it will be possible to supply gas via the Turkish stream using two lines," Novak said. At the same time, he added that Bulgaria and Austria are the priority directions for deliveries through the Turkish Stream.
Russian President Vladimir Putin estimates 2018 gas deliveries to Europe at 200bn cubic meters . The Russian president noted that European countries will inevitably consume Russian gas because "other options are more costly and will reduce the overall competitiveness of European economy." Putin concluded that both Russia and Europe are interested in implementing the
90 RUSSIA Country Report November 2018 www.intellinews.com