* Russia aims to double LNG market share to 10 pct by 2020
* Wants to produce 35-40 mln T of LNG by 2020 from 10 mln
* Russia big in conventional gas, has been slow to develop
By Vladimir Soldatkin and Katya Golubkova
MOSCOW, Oct 30 Russia will open up liquefied
natural gas (LNG) exports for companies other than Gazprom
under a law passed by the government on Wednesday as
part of plans to more than double its global market share by
Gazprom is the world's largest gas producer but has only one
LNG plant with an annual capacity of 10 million tonnes and just
a 4.5 percent global market share.
It plans to build new facilities, as do rivals Rosneft
and Novatek, which aims to launch the first
"Let's hope that this (new law) will create additional scope
for the whole energy industry and allow us to secure a footing
in fast-growing economies," Prime Minister Dmitry Medvedev told
a government meeting, referring to Asian markets including top
LNG importer Japan.
SURGING U.S. OUTPUT
Unconventional shale gas has allowed the United States to
surpass Russia in overall gas output, and it is set to cede
supremacy in oil production to Washington, as well.
President Vladimir Putin has called on industry to spur LNG
output, and Novatek, Russia's second-largest gas producer,
working with France's Total and China's CNPC aims to
produce 16.5 million tonnes of the fuel by 2018 in Russia's
Arctic Yamal Peninsula.
Rosneft aims to produce LNG jointly with U.S. company
ExxonMobil in Russia's Far East.
Analysts said it was time to break Gazprom's monopoly on gas
exports, which it has held since 2006. There are signs its
control of pipeline gas exports might be also curbed.
"Russia will be in a role of needing to catch up but it
could be quick. If Gazprom cannot take a decision on the
Sakhalin plant's expansion, we have Novatek and Rosneft's new
plants," said Andrey Polischuk, an analyst with Raiffeisenbank.
Some of Russia's conventional energy projects - including
the Gazprom-led Shtokman gas field - have been shelved or
cancelled since the shale oil and gas revolution in the United
Energy Minister Alexander Novak said he expected Russia to
increase its global market share in LNG to 10 percent by 2020 by
producing 35-40 million tonnes, with output rising to 70-80
million tonnes by 2030. Qatar is the largest producer currently.
"U.S. (LNG) exports are supposed to come on line starting in
the 2015-2018 period at the earliest," said Kyle Davis, a
partner at law firm Goltsblat BLP.
"If Russia moves faster than its competitors to get LNG
exports on line, it will have been able to secure financing and
long-term export contracts under less dynamic LNG pricing
conditions than many expect in the future."
The LNG law, first raised last year, is expected to be sent
to the lower and upper chambers of parliament by the end of the
year. Both are dominated by allies of President Putin and it
should pass easily. Putin will then have to sign it into law.