Friday, June 27, 2008
Gazprom chief sets out world vision
June 26 2008 - Financial Times by Ed Crooks, Carola Hoyos and Catherine Belton - Gazprom set out a vaulting vision of its future status as the world’s most powerful energy company on Thursday as it belittled Opec, saying the oil producers’ cartel had in effect lost control of the market. Alexey Miller told the Financial Times that the world was undergoing “a great surge in oil and gas prices . . . which will end with prices at a radically new level”. He added that even Opec had no real influence on prices. “Not a single decision has been passed of late that would really influence the global oil market.” Mr Miller continued: “In the coming years Gazprom will be not just a major company in the world, but the most influential in the energy business,” adding that its target was to reach a market capitalisation of $1,000bn. He also said international energy companies should invest in Russia only alongside state-controlled companies, such as Gazprom, if they wanted to succeed. He stressed that the Russian market was increasingly attractive to Gazprom as domestic gas prices rose, but also talked of plans for expansion in the Americas, Asia, Europe and Africa. “We see North America as a region of our strategic interests,” he said, arguing that Gazprom was “creating a new configuration of gas supplies” to the US and Canada. Gazprom hopes to serve the North American market from 2014 with liquefied natural gas from its proposed Shtokman project off Russia’s north coast. “We are currently assessing several options of accessing the North American market,” he said, adding that Gazprom had received “many interesting proposals” from Canadian companies. He also confirmed that Gazprom was interested in the proposed Alaska gas pipeline. Mr Miller said Gazprom was “quite close” to deals in Nigeria on joint ventures for production, gas utilisation to avoid flaring, and electricity generation. It also hopes to join in building a gas pipeline for exports from Nigeria. But competition for gas and other energy resources was growing, he said, and stood by his prediction that the price of oil would hit $250 a barrel next year. He also warned that Russian domestic demand was an increasingly potent destination for Gazprom’s production. “Europe and Asia [have] encountered a new, powerful competitor, which is the Russian domestic market,” he said.
Gazprom eyes Asian LNG partners24 June, 2008 - Upstream OnLine - Russian gas monopoly Gazprom will consider inviting South Korean and Japanese partners to process gas in the country's far east as it prepares to become a major supplier of liquefied natural gas. Gazprom executives said today that it was also exploring ways to supply gas to South Korea from the Russian city of Vladivostok, as part of an agreement with state-run Korea Gas that will run until 2013, wrote Reuters. Deputy chief executive Alexander Medvedev told a news conference a pipeline would be the cheapest way for Gazprom to move gas to South Korea, but that the division of Korea made this difficult. North Korea lies between Vladivostok and South Korea. "The idea of sending gas by pipeline to South Korea clashes with the divison of the two Koreas," Medvedev said. "The economical delivery of gas by pipeline needs to be resolved by the Koreans, and that's also a question of their relations with the United States," he said. Korea Gas is seeking to import 1.5 million tonnes a year of natural gas from Sakhalin-2. Gazprom plans by 2020 to supply 21 billion cubic metres of LNG from a new plant on the island of Sakhalin to countries in the Asia-Pacific region. By 2030, it plans to raise supplies to 28 bcm per year. In a statement distributed to reporters at the news conference, Gazprom said it was considering partners for gas projects in the Russian Far East. "We are working out the possibility of the participation of Japanese and South Korean companies in projects to create gas processing and petrochemical production in the east of Russia," Gazprom said in the statement. Gazprom plans to start shipping LNG from its Sakhalin-2 project by the beginning of 2009. Meanwhile, from Sakhalin-1, Medvedev said it was unlikely gas would be sent to China, contrary to a preliminary agreement signed by its partner in the development, ExxonMobil. "We don't see any prospects for sending gas from Sakhalin-1 to China," Medvedev told the news conference. ExxonMobil said in February gas from Sakhalin-1 could be exported as the Russian market would not require all of the gas produced there. The US company signed a preliminary agreement in 2006 to sell gas to China, but Gazprom last year asked the Russian government to block ExxonMobil from selling Sakhalin gas in Asia, saying production was required for the domestic Russian market.