Expert: Russia Needs to Regulate Gas Supplies Schemes

8 october 2015

More than 1500 Russian and foreign experts are discussing the future of the global gas industry at the 5th International Gas Forum, which is taking place in St. Petersburg, with the support of the Analytical Center and other organizations.

Alexei Miller, the Chairman of the Board of Directors of Gazprom, while opening the plenary session of the Forum noted the ongoing trend of demand for Russian gas in the foreign markets that keeps the blue fuel being the locomotive for both the Russian fuel and energy complex and the Russian and world economy. "In the 3Q of 2015, Russia supplied 23% more gas than in the same period last year, and only in September 2015 growth accounted for 24% compared to 2014," said Mr. Miller.

Foreign experts, who took part in the plenary session, spoke about the environmental factor that is considered in matters related to urban development and population growth. "We will soon submit a draft confirming the high efficiency of gas with minimal emissions of pollution," said David Carroll, the President of the International Gas Union. "We must promote the use of clean technologies, in particular - natural gas, and it should be included in the country's economy more than ever," said Christopher Fry, the Secretary General of the World Energy Council.

During one of the thematic round tables on 6th October experts discussed the impact of the international gas infrastructure projects for development of geo-economic cooperation and investment trust. According to  Alexander Kurdin, the Head of the Analytical Center's Department for Strategic Studies in Energy, today the situation resembles the beginning of 70-ies, when there were also foreign trade sanctions and it led up to the deal of the century between the Soviet Union and Germany - the "gas-pipe" deal. Today, according to experts, leaders of the world energy industry understand that the long-term stability, which is so necessary to everybody, is based on principles of cooperation, and therefore they support the development of international infrastructure projects.

Increasing Russian gas exports (mainly to the east) are mentioned in the project of the Russian Energy Strategy up to 2035, that is currently being actively discussed and finalized, which, according to Mr. Kurdin, indicates the need for a new international export infrastructure.

However, the Russian fuel and energy complex may be influenced by a number of factors which can complicate the way of Russian gas abroad, he said. Shipments to China, upon which Gazprom builds, are in the zone of uncertainty, Asian economies improve energy efficiency and, therefore, require smaller amounts of fuel, in Europe, Russian gas is not very competitive, also it is necessary to take into account the policy of the European Union in matters of the climate change and the new revival of the US and Australian LNG market. "Competition in the fuel market is escalating, and it will be difficult for Russia," Mr. Kurdin considers. According to him, this difficult situation will remain until the launch of the Turkish stream, and the Nord Stream - 2, and one of the priorities of the Russian gas industry - to regulate supplies schemes. It is also necessary to create new export routes and further gasification of Russian regions - especially in Eastern Siberia and the Far East, according to the expert.