Page 101 - RusRPTFeb22

9.2 Major corporate news 9.2.1 Oil & gas corporate news
● Gazprom
Gazprom wants to buy 50% in the capital of Baltic Chemical Complex, Kommersant reports. The Federal Anti-Monopoly Service (FAS) has approved Gazprom's request. At the moment, the owner of BCC is Rusgasdobycha. The transaction amount is unknown. Baltic Chemical Complex, which is planned to be built in Ust’-Luga, is a plant for producing base polymers with a capacity of 3mnt/a of polyethylene (PE) and polypropylene (PP). It was planned as part of a technological plant for processing ethane-containing (wet) gas from Gazprom’s fields that include the Baltic LNG project (a joint venture of Gazprom and Rusgasdobycha). The current project envisages transporting ethane-rich gas from Nadym-Pur-Taz to the Baltic in a separate stream. At the end point of the route, the ethane is to be separated. The cost of the project, as well as the potential additional investments are unclear at the moment. We note that petrochemical margins remain relatively strong, with crack spreads for PE and PP standing at USD 1,402/t and USD 1,217/t, respectively (compared with the pre-pandemic levels of USD 624/t and 672/t, respectively). Overall, we treat the news as not market-moving.
Gazprom has filed arbitration in the Arbitral Tribunal in Stockholm against Polish PGNiG, Vedomosti reported yesterday, 16 January. Gazprom is seeking to revise the contract price for the Yamal contract, which was up for contract revision requests on 8 December 2017 and 9 November 2020, according to a PNGiG press release.
Gazprom has bought three oil and gas condensate areas in Yakutia at auction for RUB1.19bn ($16mn), although the initial price was RUB24.5mn, Interfax and Vedomosti report. Gazprom received the Tyukyansky, Kastyr-Sakharny and Varvarinsky areas (RUB202mn, RUB748mn and RUB243.2mn, respectively). The total resources at the areas purchased by Gazprom areas estimated at 13.4 bcm. VTBC calculates that the company is to pay $0.2/boe of total resources for the three areas. In our view, they areas will require significant exploration work in order to confirm the potential reserves. As a result, we think that production at the fields is unlikely to be commissioned in the short or medium term. Therefore, we see the news as neutral for stock.
Gazprom won the West-Malyginsky license area at auction on January 19. The company paid Rb14bn (c$200mn), beating out Novatek’s bid. Interfax reported. Analysis: A giant field, if smaller than some others. Prospective resources at W-Malyginsky (D0-D2 under Russian standards) total c875bcm of
101 RUSSIA Country Report February 2022 www.intellinews.com