Econ ministry lowers gas production forecasts
MOSCOW. Nov 7 (Interfax) - Russia's Economic Development Ministry has lowered its conservative forecast for gas production in the country by 10 billion cubic meters (bcm) in 2020 and 18 bcm in 2030, according to an explanatory message accompanying the ministry's updated long-term forecast for the period until 2030.
The ministry now considers the conservative development forecast to be the base one.
In line with the updated conservative forecast - the previous one was confirmed back in March - gas production in Russia should increase to 769 bcm, which is 10 bcm less than in the prior forecast, and 14 bcm lower than in the moderately optimistic version. By 2030, gas production will increase to 831 bcm, which also is lower than earlier forecast by 18 bcm and 39 bcm, respectively.
"The adjustment of the forecast is mainly associated with the high risks to deliveries of Russian gas to Ukraine, due to which the forecast for export volume to Ukraine is lowered by ten billion cubic meters to 30 billion cubic meters by 2030," the message says.
Considering the continuation of the developing trend to less gas consumption by power plants and boilers in Russia's Unified Energy System, as well as slowing development in the chemicals and gas-chemicals sectors, the forecast for domestic demand for gas in 2020 is down 8 bcm in the conservative forecast and 11 bcm in the moderately optimistic version. Those figures rise to a respective 21 bcm and 30 bcm for 2030, the document says.
Nevertheless, a partial offset to the decrease in gas production is forecast based on increased exports to countries outside the FSU due to the possible persistence of a trend toward renewed demand in the Eurozone, as well as liquefied natural gas (LNG) exports increasing to 42 million tonnes in 2020 and remaining at that level until 2030.
According to the new conservative forecast, the expansion of the Sakhalin-2 project is not foreseen, although the Rosneft project for liquefying gas on Sakhalin does feature. Sakhalin-2 shareholder Gazprom has proposed buying gas for the expansion of Sakhalin-2 from the Sakhalin-1 project, of which Rosneft owns 20%. Rosneft and ExxonMobil, the Sakhalin-1 project operator, plan to build an LNG plant on Sakhalin, the first production line of which will use their own resources and the second Sakhalin-1 gas.
In the ministry's base version, the production of gas is planned with the intensive development of gas deposits on Yamal Peninsula and in offshore Sakhalin waters, as well as the beginning of the development of the Chayanda deposits in Yakutia. The implementation of Novatek's LNG project Yamal LNG and Gazprom's Vladivostok LNG is envisioned.
Moderate growth in pipeline gas exports to 209 bcm in 2020 and 237 bcm in 2030 is seen. The proportion of exports to Asian-Pacific markets in 2020 will not exceed 5%, but will increase to 11% of pipeline gas exports by 2030.
