Liberalization of LNG exports from Arctic to increase production of fuel to 100 mln tonnes per year in seven years - PM Mishustin
MOSCOW. March 9 (Interfax) - Liberalization of reduced natural gas exports from the northern regions of Russia will increase annual LNG production to 100 million tonnes in the next seven years, Prime Minister Mikhail Mishustin said at the opening of a government meeting.
"Upon the order of the president, the government is working to increase the volume of production and export of liquefied natural gas. A bill has been developed that will help to more actively use the capacities of the Arctic routes and for the transportation of LNG to the countries of the Asia-Pacific region. The government proposed adding promising fields to the list of fields from which LNG export is allowed subsoil plots located at a considerable distance from the unified gas supply system, such as the areas of the Krasnoyarsk Territory and the Yamalo-Nenets Autonomous District (YNAD), where around three trillion cubic meters of natural gas is located," Mishustin said.
"The decision taken should allow for increasing annual LNG production to 100 million tonnes in the next seven years, as well as for significantly increasing exports and generally strengthening Russia's position in the global market for such environmentally friendly fuel," Mishustin said confidently.
The government is considering a draft law on amendments to Articles 2 and 3 of the Federal Law "On Gas Exports."
"The draft law envisages granting the exclusive right to export LNG to users of subsoil areas on land, fully or partially located north of the 67th degree of northern latitude, in terms of natural gas in liquefied state, produced from natural gas and (or) oil (associated) gas produced in the above subsoil areas, and the use of LNG in bunkering sea and river vessels carrying cargo for export," the statement accompanying the meeting said.
This draft law, developed by the Energy Ministry, was presented last May. "The gas fields located to the north of 67 degrees of northern latitude (the Krasnoyarsk Territory and the Nenets, Yamalo-Nenets Autonomous Districts) are significantly remote from the Unified Gas Supply System (UGSS), so monetization of gas from these fields is economically feasible only through LNG production," an explanatory note indicates.
"Exemption of bunkering operations with vessels carrying liquefied natural gas from the gas export law will stimulate the use of LNG as bunker fuel, which is more environmentally friendly and an alternative fuel for sea and river navigation," the ministry said.
Several natural gas liquefaction projects are currently under consideration in Russia - several initiatives by Novatek in the Arctic (on the resource base of the Yamal Peninsula in YNAO and the Gydan Peninsula in the Krasnoyarsk Territory), while Novatek's subsidiaries, in particular Yamal LNG, Arctic LNG 2, Arctic LNG 1 and Ob LNG, already have the right to export LNG.
