Page 6 - FSUOGM Week 20 2021

FSUOGM COMMENTARY FSUOGM

Gazprom's gas fields on
the Yamal Peninsula.

Gazprom has a monopoly over pipeline advancing liquefaction projects.
gas exports in Russia, and the government has “Several scenarios are currently being con-
refused to liberalise supplies despite lobbying sidered,” the minister said. “The priority options
by other companies, reasoning that this would look like the development of gas chemicals, as
drive down Russian gas prices in export mar- well as the possibility of using the resource base
kets. However, Novatek has been selling LNG in to enter new markets, that is, through LNG
Europe since late 2017, prompting Gazprom and production.”
some government officials to call for regulation Novatek CEO Leonid Mikhelson report-
to prevent this. edly made another request to Russian Presi-
The notion of competition between Russian dent Vladimir Putin in April to let his company
pipeline gas and LNG is “rather far-fetched,” develop the Tambey group of fields, currently
Shulginov said. under Gazprom’s control. Gazprom acquired
“Of course there is competition in the global rights to the fields in 2008 without having to bid
pipe gas and LNG market, this cannot be denied. in a tender, but has still not advanced a develop-
But firstly this is competition between Russian ment plan. The company has spurned repeated
gas and the LNG of the US and Qatar,” he said. requests from Novatek to form a partnership to
“Not all European countries are connected to use the gas to underpin LNG exports. It instead
our gas pipelines, so it is good that, for example, favours using their gas for pipeline exports.
Spain has the opportunity to purchase Russian The 7.3 trillion cubic metres of gas at the
LNG. In addition, the mobility of LNG supplies Tambey fields is wet, containing large quanti-
allows Novatek to quickly reorient supplies to ties of ethane. Ethane can be separated from
Asia when prices there sharply rise.” gas for pipeline use, but it is far simpler to do so
The ministry is currently weighing up the through the liquefaction process. The ethane
best options for how to develop the vast gas can then be used as petrochemicals feedstock.
resources on the Yamal Peninsula. While Gaz- According to Russia’s Kommersant, Mikhelson
prom wants to use its fields to support pipe- convinced Putin that liquefaction would be the
line exports to Europe and China, Novatek is best course.™

P6 www. NEWSBASE .com Week 20 19•May•2021