Page 141 - RusRPTNov21

bcm annualized, versus the prevailing 2021 production guidance of 510 bcm). The company once again highlighted its flexibility and its substantial remaining spare production capacity, which should allow it to fully meet all of its contractual obligations.
The company raised its guidance for the average realized European gas export price this year to $295/mcm (from its most recent projection of $270/mcm). Current short-term forwards imply potential upside to this year's pricing (more than $330/mcm). The company preliminarily expects an average European export price next year of more than $350/mcm.
Gazprom held a webinar on October 5 devoted to ESG. The key highlights are as follows.
● In 2020, Gazprom reduced CO2 emissions (Scope 1) 11% due to a decrease in the specific CO2 kg per ton of manufactured products. Use of mobile compressor stations in 2020 allowed the company to reduce methane emissions by 500mcm (some 8mnt of CO2) during pipeline maintenance. For 2021 the number was guided at 700mcm (12mnt of CO2). The plan for 2022 is for 1bcm lower gas emissions.
● As part of its short-term planning, Gazprom has set emission reduction targets until 2031 (5% lower carbon intensity in power generation by 2025 and 10.5% by 2035; 3.1% in the gas business by 2025 and 11.2% by 2035). The company is also to form long-term plans through the creation of an ESG roadmap. The key is the third stage, which the company is to present in May 2022, when it is to set a carbon neutrality goal and timeline.
● On hydrogen, the company is considering various transportation options – for example, by pipeline or in liquefied form, as well as together with ammonia as a carrier.
Gazprom’s 5-year gasification budget was increased RUB 259bn, from RUB 526bn for ‘last mile’ connections and the within-settlement pipeline, and by RUB 480bn for gasification in already gasified areas (the potential maximum if all eligible households decide to connect to the gas grid).
Nord Stream 2 AG has filed an appeal with the Supreme Federal Court of Germany against the German court’s earlier decision not to exempt the NS2 pipeline from the EU Gas Directive. Separately, the German energy regulator has requested that Nord Stream 2 AG confirm that the pipeline complies with EU regulations. The regulator said that it cannot rule out one of the lines of the pipeline starting operations soon.
Gazprom is considering increasing the LNG capacity at the planned LNG plant in Ust-Luga, Kommersant reported yesterday, 7 October. The company had planned two trains of 6.5mnt p.a. each, but the company is now considering a third one that would bring the plant’s total LNG capacity to 19.5mnt p.a., putting it on par with Novatek’s Arctic LNG 2. Kommersant notes that Gazprom has not announced the resource base for a third train. The first train is planned for launch in 2024, the second in 2025 and the potential third in 2026.
141 RUSSIA Country Report November 2021 www.intellinews.com