Gazprom more interested in shale oil than shale gas in Russia - Miller
MOSCOW. Oct 29 (Interfax) - Gazprom is more interested in extracting shale oil than shale gas in Russia, company CEO Alexei Miller said.
"In contrast to the shale gas extraction , which is quite out of date in Russia, the tight oil production is of considerable interest for Gazprom Group and we will work actively on this issue," a Gazprom Neft statement quoting Miller says.
The scientific journal Gas Industry published this year an article by Vladimir Yakushev, who at the time was secretary at LLC Gazprom VNIIGAZ, about the economics of producing gas from nontraditional sources. The author estimated the cost of producing shale gas in the Volga region (around Saratov) at from 2,400 to 5,400 ruble per thousand cubic meters, with an average estimate of 3,900 rubles (today the regulated gas price for Saratov Region is 3,360 rubles per 1,000 m3, not counting VAT). The researcher concluded that on the Russian market shale gas is "on the border of profitability."
The Gazprom Neft board of directors considered last Friday the prospects for producing shale oil, experience with which the company is acquiring during the development of the Bazhenov strata at the Verkhne-Salym oil deposit, which iss being worked by the Gazprom Neft - Shell joint venture Salym Petrolelum Development (SPD). Gazprom Neft, Shell, and SPD specialists have created a 'roadmap' for putting the Bazhenov structure into industrial production.
The board of directors also addressed the application of new technologies for oil production. Company specialists estimate that the use of innovative developments for the oil company's existing deposits could result in the additional production of 700-950 million tonnes of oil. By 2020, with the use of new technologies, the company is looking to produce about 35 million tonnes of oil of the planned 100 million tonnes of oil equivalent production.
The board also looked at the further development of the company's international business. The company intends to develop existing production projects and consider the possibility of taking part in new assets. "The company will continue to expand the scope of its international business, developing projects in the production sector and considering opportunities to participate in new projects, as well as studying the prospects of gaining access to European vertically integrated companies capable of supporting the business's high margins and developing oil product sales areas in premium distribution segments," the company said.
"In particular, the company has geological exploration and production projects in nine countries in the Balkans, the Middle East, Africa and Latin America. Its crude oil refining projects include two oil refineries (owned by the Serbian company NIS, 56.5% controlled by Gazprom Neft) in Serbia with a total installed capacity of 7.5 million tonnes of oil, as well as oil and lubricant production lines in Italy and Serbia. Gazprom Neft's enterprises supply jet fuel to refueling complexes at more than 80 airports in over 30 countries. Gazprom Neft's networks of filling stations and oil depots outside of Russia are located in Central Asia, Ukraine, Belarus and the Balkans," the company said.