2 Mar 2021 15:26

Gazprom preparing to start delivery of 'green' LNG to Europe

MOSCOW. March 2 (Interfax) - Gazprom preparing to launch deliveries of carbon-neutral 'green' LNG, head of the LNG exports division at Gazprom Export Pavel Sedov said during the presentation of a Shell report on the prospects of LNG market development.

"There are not many carbon-neutral LNG cargoes shipped around the world yet, and we are taking our first steps here, too. And I would like to thank Shell for their constructive partnership approach which helps us find ourselves in this segment. I hope that in the near future we will deliver our first completely carbon-neutral shipment of liquefied natural gas to Europe. This will be a definite achievement and the first step to a more environmentally-oriented portfolio of gas products," Sedov said.

Earlier, Sakhalin Energy (co-owned by Gazprom, Royal Dutch Shell (SPB: RDS.A), Mitsui and Mitsubishi), the operator of Russia's first LNG plant, said it was considering bringing carbon-neutral LNG to market.

Gazprom delivered more than 7 million tons of LNG in 2020 and expects to increase LNG trading turnover "more than twofold" by 2025, Sedov said. This estimate covers the company's global operations, but growth will mainly come from the development of the Ust-Luga project (13 million tons), he said.

"We are also considering participation in a number of smaller [than Yamal LNG, from which Gazprom also supplies gas] LNG projects which will play a role in filling regional demand. However, many such projects were unfortunately delayed in 2020 due to force majeure circumstances. And this will be an important factor for assessing the dynamics of new supply, and this will be an important factor in assessing the dynamics of new supply in small regional projects," he said.

In its latest quarterly report, Gazprom provides more detailed data on LNG shipments in 2020, and they correlate with what Sedov has said: through Gazprom Marketing & Trading Singapore PTE. LTD. and Gazprom Global LNG Ltd. 7.47 million tons (10.932 billion cubic meters) were delivered following delivery of 5.044 bcm in 2019.

"In 2020, the geography of Gazprom Group's LNG shipments has expanded significantly thanks to the increase in the trading portfolio. As such shipments in 2020 went to 14 countries: India, Korea, Great Britain, China, France, Spain, Japan, Taiwan, Thailand, Singapore, Kuwait, Greece, Belgium and the Netherlands. Other volumes were shipped on FOB terms," Gazprom said in report published in mid-February.