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UPDATE 1-Gazprom tells customers to compete for Eastern gas
June 21, 2011 / 12:29 PM / 6 years ago

UPDATE 1-Gazprom tells customers to compete for Eastern gas

* Sakhalin-3’s Kirinskoye to launch in 2012

* Gazprom sees Exxon deal on Sakhalin-1 gas this year

* Sakhalin-2 to ship two extra LNG cargoes to Japan in July

By Jessica Bachman and Melissa Akin

MOSCOW, June 21 (Reuters) - Russian gas export monopoly Gazprom’s renewed eastwards push will start next year with the launch of a new field at the Pacific island of Sakhalin, company officials said on Tuesday.

“Who pays the most will get the gas,” Gazprom Deputy Chief Executive Alexander Ananenkov told a news conference, where he laid out plans to tap new fields across Russia’s eastern half to fuel domestic industry and supply growing Asia-Pacific markets.

Ananenkov’s remarks sounded like a warning to China, which last week failed to agree a final price for Russian pipeline gas deliveries in talks that had been meant to end five years of negotiations.

Ananenkov reiterated that Gazprom still expected a deal this year, though hopes are starting to dim after the countries’ national energy companies failed to strike a deal in time for Chinese President Hu Jintao’s visit last week.

Gas deliveries to China are due to start in late 2015 under earlier agreements and last 30 years.

Gazprom will launch the Kirinskoye field, part of its Sakhalin-3 project, in the second quarter of next year, Ananenkov said.

“To launch Kirinskoye we are conducting intensive works on an underwater drilling complex and preparing personnel,” Ananenkov told a news conference.

“We will unite drilling technology with an underwater platform,” Ananenkov said. “This will happen for the first time at Kirinskoye.”

Elsewhere on Sakhalin, Gazprom is aiming to end a long-running dispute about the fate of gas from the ExxonMobil-led Sakhalin-1 project this year with a final agreement to buy the gas for the Gazprom system.

ExxonMobil had wanted to sell the gas to China independently of Gazprom.

Among other fields destined to supply Pacific customers, Ananenkov said, full scale gas production at the Chayandinskoye field would be launched in 2016 as planned.

The launch of Chayandinskoye is also key to the start of production of liquefied natural gas (LNG) at a new plant planned for Russia’s Pacific coast in 2017.

“The estimated launch date is 2017, considering the launch of gas production at Chayandinskoye,” Ananenkov said.


Additional demand from Japan, following the country’s loss of several nuclear facilities for power generation, has strengthened Gazprom’s hand in talks with China -- underlining that Russia could have a choice of buyers for the gas it plans to pump in Russia’s east.

It has already stepped in with additional volumes since the Fukushima nuclear disaster unleashed by the March earthquake in Japan.

Pavel Oderov, head of Gazprom’s foreign department, said Gazprom could cover all Japan’s additional needs, including direct sales and extra pipeline deliveries to Europe to compensate for LNG cargoes diverted to Japan.

“This would completely solve the Japanese consumer’s problem,” Oderov said.

The Gazprom-led Sakhalin-2 project will send two extra cargoes of liquefied natural gas to Japan in July to cover increased gas needs after the Fukushima disaster, he said.

The entire 10 million tonne per year nameplate capacity of Sakhalin-2 is contracted to consumers but the consortium has been able to ramp up output since Japan’s nuclear disaster and sent three additional cargoes so far. (Reporting by Jessica Bachman and Melissa Akin; writing by Melissa Akin, editing by Anthony Barker)

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