Pavel Zavalnyi: successful implementation of gas export projects requires a regulatory framework

Chairman of the Committee on Energy expressed that opinion at the International Sakhalin Oil & Gas Conference 2018 in Yuzhno-Sakhalinsk. According to him, it is important to create a model for complementarity of all gas projects that will maximize Russia's export revenues, balancing the interests of the state, regions and companies
Chairman of the Committee on Energy Pavel Zavalnyi
Chairman of the Committee on Energy Pavel Zavalnyi

As the Chairman of the Committee noted, the development of a self-sufficient sector requires tax and customs, tariffs stimulation and concessional lending for the use of domestic equipment, support for the localization of production of modern foreign technologies necessary for the development of oil and gas services; the formation of consortia, engineering centers and innovative clusters pooling the resources of companies, the parliamentarian said.

Success of Arctic LNG projects can become a certain challenge for the Sakhalin oil and gas industry, ”if companies do not find a common language and projects cannot be expanded.“

”The launch and rapid development of Yamal-LNG project is a huge success for the Russian gas industry, but, it seems to me, for Sakhalin, for companies that have plans to increase LNG production, but are not able to launch its implementation, it is definitely a challenge,“ the parliamentarian said. The state authorities, for their part, support projects, including foreign economic resources. Pavel Zavalnyi Zavalnyi Pavel Nikolaeviсh Zavalnyi
Pavel Nikolaeviсh
recalled that Russian President Vladimir Putin mentioned two weeks ago that the possibility of integration of Japanese partners to the Sakhalin-2 project and the construction of the Kamchatka LNG transshipment complex is being considered.

”Let me also note that the situation on the global LNG market today is more favourable for our projects than a year or two ago,“ he said. — According to the Ministry of Energy, , a niche market in the amount of about 200 million tons of LNG per year will be formed from 2024 to 2035, and Russia will be able to occupy up to half of this niche.“ The Chairman of the Committee estimates the possible gas export from Russia by 2030 to 350 billion cubic meters, about 130 of it -to the APR market.

Pavel Zavalnyi believes that export volume to the European market can grow to 220 billion cubic meters, to the APR market— up to 130–140 billion cubic meters, about 50% of it is pipeline gas and the second 50% — LNG.

”Of course, this is a very optimistic scenario, and many factors should come together for its implementation, but the current and forecasted level of hydrocarbon prices, prospects for gas demand growth in Europe and Asia, the plans of companies and government support measures, in principle, allow it to be realized. It is important now to create a model of complementarity of all Russian gas export projects, which will maximize the country's export revenues, balancing the interests of the state, regions and companies. And to establish an appropriate regulatory framework for the implementation of projects“, — Pavel Zavalnyi said.

The parliamentarian also believes that the oil and gas services should strive for technological self-sufficiency, despite the examples of productive cooperation with world leaders. ”This is the calling of our time”, the Chairman the Committee on Energy concluded.