15 November 2011, 16:48

Russia has enough gas to “feed” Europe

Russia has enough gas to “feed” Europe
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Russia has ambitious plans about gas producing: it is planned that by 2030, the production of gas in the country will double, compared to the current amount – namely, it will make 1 trillion cubic meters.

Russia has ambitious plans about gas producing: it is planned that by 2030, the production of gas in the country will double, compared to the current amount – namely, it will make 1 trillion cubic meters. 

This figure was revealed by the President of the Russian Gas Society Valery Yazev, who is also the Vice Speaker of the parliament’s lower house, the Duma.

Russia’s largest-scale projects in the gas sphere are the development of the Shtokman gas field in the northern sea of Barents, and “The Nord Stream”, a pipeline which will deliver Russian gas to Europe. 

An international forum “Russian Gas-2001” is currently under way in Moscow. This is one of the main events of the year for both Russian and foreign businesspeople who have to do with gas. Among the participants there are representatives of such gas giants as the Russian “Gazprom”, “British Petroleum”, the Norwegian “Statoil”, the French “Total”, the German “Ruhrgas” and others.

It is well known that energy is, practically, the main sphere of cooperation between Russia and the EU. At present, Russia is the main supplier of gas to the EU. Moreover, experts are predicting that in the nearest future, there’ll be a big boom of gas consumption in Europe, and, by 2030, one half of the gas consumed by Europe will be Russian gas.

Russia already has something to satisfy Europe’s gas “appetites”. It is actively developing “Shtokman” and other gas fields in the Arctic Shelf. Experts say that the shelf has enough gas to meet Europe’s demands for the next 90 years or maybe more.

However, it is rather difficult to extract gas in the severe conditions of the Arctic. In fact, this is next to impossible without up-to-date technology.

“Russia is ready to introduce tax privileges for companies which will develop the Arctic gas deposits for some time,” Valery Yazev says:

“It is very hard for a company to develop gas deposits in the Arctic if its tax burden is not lightened – though I am not saying that these companies should be altogether freed from taxes. Moreover, let me suggest that there should be no customs duties for importing equipment for oil and gas extraction, analogues of which are not produced in Russia. Otherwise, it would be hardly possible for Russia to build new oil and gas producing complexes.”

The “Nord Stream” pipeline, which goes across the Baltic Sea, is the most convenient way to pump Russian gas to Europe. The first part of it already started working last week. 

Unfortunately, not everything is going as smoothly as Russia would like it to go. The apple of discord is the so-called “third package” of EU’s directives, which demands that Russia sells the “Nord Stream” pipeline to certain European companies. Russia is categorically against this. However, there are some signs that the EU is gradually becoming less persistent about this “third package”. At the ceremony of opening “The Nord Stream”, Germany’s Chancellor Angela Merkel called on the European Commissioner for Energy Günther Oettinger “to make EU’s energy policy more understandable for EU’s partners”. 

Alexander Pasechnik from the Russian Foundation for Energy Security says:

“There are French, German and Dutch companies among the stockholders of “The Nord Stream”. Russia hopes that they will support its efforts to persuade the EU’s leaders to abolish the statements in the “third package” which are unprofitable for Russia. As you probably know, in Germany, “The Nord Stream” will be connected with the two local pipelines, “OPAL” and “NEL”. “OPAL” has already been built, and there are grounds to say that the influence of “the third package” will be much lowered there – 75% of this pipeline capacity will not be obliged to obey the directives of that package.”    

For all its powerful capacities, “The Nord Stream” will be not enough to fully satisfy Europe’s demands for gas, but there is another ambitious project among Russia’s plans – “The South Stream”, which will go across the Black Sea. It is planned that “The South Stream” will start working in 2015. Its promoters are the Russian company “Gazprom” and the Italian “Eni”.   

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