Outlook for Russian LNG Industry

European sanctions and Brussels’ policy of abandoning Russian energy resources plus the destroyed Baltic gas pipelines have shut in Russia a respectable volume of pipeline gas that cannot promptly be sent to alternative markets. This would seem a strong argument in favour of developing LNG production in Russia.

Seaborne supplies of gas are much more flexible, so if Russia had appropriate capacity it could repeat the success of the oil industry.

One year into the military operation in Ukraine, oil companies have not lost their export volumes: from Europe crude oil and petroleum products have gone to other markets and surprised Western forecasters.

There is one “but” here, however: so far Russia has not a large-scale LNG production process of its own, while foreign technology partners are in a hurry to leave Russian projects. Neither can Russia build gas tankers for Arctic conditions that are necessary to carry LNG. So the salvation strategy that seems evident is not that easy to implement.

The new NESF report must give the answer to the question about what part of the plans for dramatic increase in LNG production in Russia can be considered realistic.

The new report looks into the following subjects:

Situation with plants under construction

• How realistic the declared deadlines and sizes are

Possible and likely LNG projects

• An audit of the plans of Novatek, Gazprom, Rosneft, and other companie

Technological challenges and possible problems with equipment

• Compressors, pumps, gas turbines, heat exchangers: key weak spots and options for their removal

Economics and competitiveness of Russian projects

• Cost of production, liquefaction, and logistics

The result?

• Can the production level of 100 million tonnes be reached by 2030?
• How will Russia fit into the global sector development scenarios?

Contents of the report: