Gazprom eyes Asian LNG market



REUTERS

Published — Sunday 23 June 2013

Last update 23 June 2013 5:17 am

| نسخة PDF Print News | A A

ST PETERSBURG: Gazprom is ready to take on potential Russian and Australian rivals for Asia's ballooning liquefied natural gas market, its export chief said after President Vladimir Putin signaled an end to its exclusive right to export LNG.
Putin said Gazprom's rivals such as Russian company Novatek, which is building an LNG plant on the Arctic Yamal peninsula, would gradually be allowed to export LNG, a move seen by analysts as a first crack in Gazprom's legally enshrined export monopoly.
Novatek has said that the rising costs for new Australian LNG capacity have led to Asian interest in its Arctic gas, even though this will have to be liquefied and shipped via the so-called Northern Sea Route accompanied by icebreakers.
By contrast, state-controlled Gazprom has a project to liquefy gas at Vladivostok on the Pacific coast, much closer to Asian markets.
"If production and liquefaction on Yamal is competitive with Australian gas, then the Vladivostok plant or a European plant would be significantly more competitive," Alexander Medvedev, CEO of Gazprom Export, said in an interview.
"We will earn more money", he said.
Medvedev said the granting of export rights to rivals would not hurt Gazprom, provided ground rules are established. Putin has said a condition of liberalization is that non-Gazprom LNG should go only to the growing markets of Asia, not to Europe, where Gazprom earns most of its revenue.
"It would be a pretty strange thing for Russian gas to compete with Russian gas, although we are not afraid of competition and compete with other suppliers," Medvedev said.
"We need to figure out what kind of volumes will end up on the market. If we are talking about Yamal, its target market is southeast Asia," Medvedev said.
He said exports of gas by pipeline would not be opened up to rivals.
"I don't think it will even be discussed," Medvedev said.
Medvedev played down prospects for a deal to deliver pipeline gas to China, adding that Gazprom CEO Alexei Miller's assurances a deal could be reached as early as September reflected hopes that "thinking makes it so".
He said price, the main sticking point in 15 years of talks on a pipeline gas deal, remained an issue and that previous reports that an agreement had been reached on prepayment by the Chinese side were incorrect.
"When we agree the price we will agree prepayment," he said.
He rejected suggestions that Western hub prices could serve as a benchmark for Chinese or other Asian gas deliveries.
Gazprom favors the regional oil-linked benchmark, the Japanese Crude Cocktail (JCC), the basis for deliveries to Asia from Sakhalin-2, Russia's only functioning LNG plant, which is operated by Gazprom with partners Royal Dutch Shell and Mitsui.
Some analysts say the potential supply from US projects to liquefy natural gas from shale would make US spot pricing a potential benchmark for Asian supplies, but Medvedev rejected the suggestion.
"We don't see any reason to deviate from the JCC."

What's happening around Saudi Arabia

JEDDAH: Employees of the Education Office in Al-Daer governorate, Jazan, where seven people were gunned down on Thursday are in a state of shock and perplexed as to what prompted the attacker — a teacher — to take such an extreme step.The teacher, id...
JEDDAH: The campaign to support Syrian refugees with all their needs is being carried out effectively, as per the directives of Custodian of the Two Holy Mosques King Salman, Crown Prince Mohammed bin Naif and Deputy Crown Prince Mohammed bin Salman....
RIYADH: The Ministry of Municipalities and Rural Affairs has ordered the allocation of separate sections for female members of municipal councils.This was announced by Jedaie Al-Qahtani of the ministry. “This is in implementation of Clause 107 of the...
DAMMAM: The 9th Saudi Student Conference which is being held on Feb. 13-14 is sponsored by Umm Al-Qura University and hosted by the University of Birmingham in the United Kingdom. It was organized by the Scientific Society for Saudi Students in the...
RIYADH: Over the past 10 years, begging in the Kingdom has increased substantially, with the number of organized gangs of expatriate beggars increasing to 85 percent of the total number of beggars, according to Social Affairs Ministry Majed Al-Qassab...
RIYADH: The Ministry of Health said it expects its blood donation drive will received 450,000 milliliters (ml) of blood when the Janadriyah festival ends on Feb. 19.Khalid Ibrahim Zobaie, who supervises the blood donation project, said the drive is i...
JEDDAH: The Shoura Council’s decision to reduce working hours in the private sector from 48 hours to 40 hours per week would result in additional operational costs in the sector due to 30 percent higher wages for expat workers, according to Mansour b...
MADINAH: Madinah Gov. Prince Faisal bin Salman recently visited a number of ongoing developmental project sites in the Holy City, as part of his efforts to ensure that they meet the set standards and deadlines.During the visit, he said that all the s...
RIYADH: The National Guard Ministry is studying the possibility of having two countries as guests of honor each year instead of one at the Janadriyah festival for culture and heritage, the Kingdom’s most prestigious annual festival.This was revealed...
DAMMAM: The Pakistan International School in Alkhobar hosted their 49th annual prize distribution ceremony to honor outstanding students in the presence of Pakistani Ambassador Manzoor Ul Haq and his wife, Nighat Manzoor.Haq appreciated the efforts o...
DAMMAM: The Weaam Association for Family Care in the Eastern Province has succeeded in addressing more than 700 cases of family disputes during the last one year.Abdulrahman Al-Khudair, Weaam’s director of public delations, said: “The association off...
JEDDAH: The Nakheel mall case has continued to grab the limelight, with a number of lawyers now offering their services to the girl who was roughed up by some Haia members in Riyadh. Some people also expressed, through social media, their support to...
RIYADH: Grand Mufti Sheikh Abdulaziz Al-Asheikh inaugurated this week a campaign tosafeguard Saudi society against bad influences.“The campaign seeks to immunize society in the Kingdom from deviant ideas as well as utter lies and heresies that could...
RIYADH: A Filipino nurse who works at a clinic in Riyadh has been missing for a week, her colleagues has said.According to a co-worker at the clinic, the 43-year-old nurse from from Lamitan town in Basilan province, southern Philippines, wa...
JEDDAH: The Ministry of Haj will put in place new measures for issuing Umrah visas for pilgrims from outside the country with the coordination of the Saudi embassies abroad, a local newspaper reported.The new measures will be implemented soon, given...

Stay Connected

Facebook