Russian Oil and Gas Industry: News #3

JohninMK wrote:Whilst it looks like Fortuna is still laying pipe AC is now not and has moved NE of the Danish island. Could be sheltering from a storm.

Looks like its back to its previous position so must have resumed pipe laying: https://www.vesselfinder.com/?imo=8770261

owais.usmani wrote:

JohninMK wrote:Whilst it looks like Fortuna is still laying pipe AC is now not and has moved NE of the Danish island. Could be sheltering from a storm.

Looks like its back to its previous position so must have resumed pipe laying: https://www.vesselfinder.com/?imo=8770261

Yes and she looks to be the same distance from Fortuna as she was before. With her faster laying we should now see her reducing the gap.

In the crisis year of 2020, the Russian Federation increased the export of liquefied natural gas

Russia in 2020, despite the crisis, slightly increased exports and expanded the geography of supplies of liquefied natural gas (LNG). This follows from the final annual report of the International Group of LNG Importers (GIIGNL).

Exports increased by 300 thousand tons from 29.3 million tons in 2019 to 29.6 million tons last year. Pakistan, Singapore, Norway and Argentina became new buyers of Russian LNG. Most of all, supplies to the countries of the Asia-Pacific Region (APR) increased by almost 3 million tons from 13.58 million tons in 2019 to 16.51 million tons in 2020. At the same time, exports to Europe, on the contrary, fell by 16.5% from 15.07 million to 12.58 million tons.

Statistics clearly show that Russian LNG supplies to Europe in 2020 decreased more than pipeline gas (a drop of 10%), so it is not entirely correct to say that domestic liquefied gas displaced pipeline gas in some markets. France - 3.44 million tons, Spain - 2.61 million tons, the Netherlands - 2.58 million tons and Great Britain - 2.07 million tons became the leaders in Europe in terms of purchasing LNG from Russia.

Spain has virtually no access to Russian pipeline gas, as do many areas of the UK, as well as some coastal and southern regions of France. These countries accounted for 63% of Russian LNG supplies, and the rest hardly affected the export potential of pipeline gas.

In Asia, most of our LNG, like last year, was purchased by Japan - 6.16 million tons (in 2019 - 6.34 million tons), which is not surprising, given the proximity of one of the Russian plants for the production of liquefied natural gas - Sakhalin- 2 "and the participation of Japanese companies in this project. China has significantly increased purchases of Russian LNG - up to 4.92 million tons (in 2019 - 2.84 million tons).

In both countries, exports from our country turned out to be higher than the indicators of the United States, our closest competitor in terms of supply growth to the region. This is especially important in relation to China, with which the United States has a trade agreement, and it was expected that in 2020, American LNG would flood the Chinese market, which is now considered the most promising in terms of gas consumption growth.

In total, last year China purchased 68.91 million tons of LNG (an increase of 11.7% compared to 2019), almost catching up on this indicator of the world leader - Japan, which imported 74.43 million tons (a decrease in consumption by 3.2 %). The leaders are also South Korea - 40.81 million tons (growth - 1.7%) and India - 26.63 million tons (growth - 11%). India could possibly have shown more impressive growth, as many analytical agencies have predicted, but the country's economy has been hit hard by the Covid-19 pandemic, which affected the year's results.

In terms of export volumes, Russia, as in 2019, was in 4th place in the world, but the balance of power has slightly changed. Australia was ousted from the first line by Qatar, having increased exports by 2.4 million tons. The largest increase in LNG supplies was made by US producers - by 11 million tons. This is due to the launch of new gas liquefaction capacities in the country. Moreover, in the next three years in the United States it is planned to implement several more projects with a total capacity of 10-30 million tons.

Our country plans to produce 140 million tons of LNG by 2035. In 2021, it is planned to launch the Port LNG plant with a capacity of 1.5 million tons and the commissioning of the fourth Yamal LNG line with a capacity of 0.9 million tons. In 2023, the first line with a capacity of 8.6 million tons of the Arctic LNG-2 project is to be launched. In the future, Russia has 15 more projects for the production of LNG, but their launch is expected after 2023.

https://36k3qhei5srbmqqa6626bxshxm-ac4c6men2g7xr2a-rg-ru.translate.goog/2021/05/14/v-krizisnyj-2020-god-rf-uvelichila-eksport-szhizhennogo-prirodnogo-gaza.html

They need to make a pipeline to Japan and maybe South Korea.

lancelot wrote:They need to make a pipeline to Japan and maybe South Korea.

The Sakhalin LNG plant is right around the corner, better to increase its capacity instead of spending billions on a pipeline.

And both Japan and South Korea are American puppets, they will never agree to any pipeline from Russia.

https://www.rbc.ru/business/11/05/2021/609971fe9a7947e065f63cd4?from=from_main_1

Russia’s oil reserves will last until 2080 at the current pace of annual production, Natural Resources Minister Alexander Kozlov told Russian outlet RBC in an interview this week.

Russia also has natural gas reserves for another 103 years of annual production at current output levels, the minister said.

Russia’s actual oil and gas reserves could even rise if it steps up exploration in hard-to-drill areas, the minister added, noting that Russia needs to develop exploration, including in hard-to-reach areas.

Last month, Evgeny Kiselev, the head of the Russian Federal Agency for Mineral Resources, told state outlet Rossiyskaya Gazeta that Russia has 58 years worth of oil reserves, of which 19 years to profitably pump those reserves at current levels with current technology. Advances in technology, however, will constantly push back the deadline.

Asked how long Russia would have oil reserves, Kiselev said “indefinitely.”

JohninMK wrote:Spot on.

Others might break their contracts, that's up to them, but its clear that Russia, before and no doubt after Putin, believes that its word is its bond. As it used to be in old fashioned face to face business.

In this way Russia might be alone in the World but its a good place to be. In business I never broke my word and often went beyond it.

As long as those pipes in Ukraine don't fall apart then, apart perhaps from war in Donbas or other contract fail, that gas will flow until the end of the contract.

Russia does not need to break the contract with Ukraine. All the need to do is pump the bare minimum through it.
It isn't enough to cover European needs. The contract is for less gas than what NS2 can carry. It will also end in 2024.

Russia should not break any contract because those contracts with Ukraine used to be about charity, but now they just make money.

If the Ukraine steals transit gas then deduct the cost of the gas to the EU customers from the transit fees paid to Ukraine at EU prices.

If the EU complains about not getting its gas then tell it it has stalled and pissed around on the solution so it is their problem.

At the end of the day Russia is losing money selling gas to the EU... they could make a lot more money shipping their gas world wide to markets that previously had no other supplies and because of that monopoly have been paying too much.

Russia can liquify its gas and transport it to those markets and make lots more money than they could with long term fixed contracts with the EU where the Ukraine will occasionally steal from them while the EU look the other way and blame Russia for no gas arriving.

There are two solutions... shipped LNG and NSII and they are rejecting NSII.

Those are the solutions... the results of rejecting NSII is that LNG or nothing become the solutions which will effect German industry and growth for the future.

Russia should shift to LNG exports. This way its gas can chase the highest bidder and not be subject to long term contracts with
hostile countries ("customers") that engage in economic blackmail and spread blood libel and defamation. While revising history
to dilute the role of the Nazis in WWII, with the ultimate intent to whitewash them eventually and pin all fault and misery on
Russia.

Buying LNG on the open market will be one of the best lessons for these self-entitled, haters and ingrates.

GarryB wrote:At the end of the day Russia is losing money selling gas to the EU... they could make a lot more money shipping their gas world wide to markets that previously had no other supplies and because of that monopoly have been paying too much.

Russia can liquify its gas and transport it to those markets and make lots more money than they could with long term fixed contracts with the EU where the Ukraine will occasionally steal from them while the EU look the other way and blame Russia for no gas arriving.

Russia is not losing money by shipping at pipeline prices to the EU. It is making good profits. It could switch to LNG but it is much more expensive to produce and ship than piped gas. The existing pipelines are a sunk cost, building LNG plants would take a lot of capital that Russia has better uses for. I would also hazard a guess that Russia makes more profit on pipeline gas than it does on LNG. Would the big,expensive pipelines be going into China if LNG was a cheaper way to supply?

The World LNG market has many suppliers and the price goes down as well as up as well as there being fixed price contracts. The largest supplier, Qatar, has its LNG plants as a sunk cost now so could outprice Russia in many markets. Not sure who the markets are that you mention that had no other supplies or of any market paying monopoly prices. The LNG market is pretty cut-throat.

Also, countries taking large quantities would probably be on long term fixed price contracts regardless of whether the gas came via pipeline or tanker.

If Ukraine steals again then the EU countries will get less than they paid Russia for. After Russia proves what went into Ukraine it is then down to the EU to sort out Ukraine. Ukraine may but after NS2 is operational it will be a perfect reason (breach of contract) to stop transhipment via Ukraine or if no NS2 then stop supply like last time. Hence Ukraine unlikely to pull that stunt again.

^^ I believe you meant to write LNG in the above post. LPG is a different thing.

owais.usmani wrote:^^ I believe you meant to write LNG in the above post. LPG is a different thing.

Thanks. Now corrected.

Russia is not losing money by shipping at pipeline prices to the EU. It is making good profits.

The EU are getting a very good price for the gas they receive, Russia could make a lot more money on the same gas sold to other customers.

It could switch to LNG but it is much more expensive to produce and ship than piped gas.

The cost of shipping and liquifying is covered in the increased cost of the new product, and being able to ship to places where the prices are much higher they can sell for rather more than they could get for piped reliable gas.... market forces... and the chance to turn the ship around and sail to another location where the price is better.

The existing pipelines are a sunk cost, building LNG plants would take a lot of capital that Russia has better uses for.

Building the LNG plants just makes sense and makes the product more portable to more markets, and with all their existing bullshit laws regarding suppliers and producers, and any new cock and bull new laws they might come up with... it is simply not worth the bother.

I would also hazard a guess that Russia makes more profit on pipeline gas than it does on LNG.

Pipelines offer security and stability for long term contracts where the customer can put money into Russian accounts and the taps are turned on and the product is delivered almost immediately, as compared with ordering and having ships arrive days or weeks later depending on where they come from, but when the customer is as unreliable as the EU it looses all its advantages and just potentially becomes a noose around Russias neck.

The World LNG market has many suppliers and the price goes down as well as up as well as there being fixed price contracts. The largest supplier, Qatar, has its LNG plants as a sunk cost now so could outprice Russia in many markets. Not sure who the markets are that you mention that had no other supplies or of any market paying monopoly prices. The LNG market is pretty cut-throat.

Russia has the capacity to supply the EU... for all its talk the US does not seem able to fill that capacity now let alone meet future growth levels.

From baltic ports and northern ports and eastern ports Russia could supply central and south america and africa easily enough, and demand for gas in expanding in Asia too.

Also, countries taking large quantities would probably be on long term fixed price contracts regardless of whether the gas came via pipeline or tanker.

There were amusing news reports about a Russian tanker supplying both the UK and US with evil Russian gas... they didn't call it Novachok but they implied it was just as dangerous... it is spreading Russian influence and power you see...

If Ukraine steals again then the EU countries will get less than they paid Russia for.

That is not what happened last time... they stuck to the contract and said Russia was obliged to supply the gas they paid for and that the Ukraine stealing their gas is not their fault... Russia is responsible.

After Russia proves what went into Ukraine it is then down to the EU to sort out Ukraine.

You would think so, but if that were the case there would not have been any problems and no reason for NSII or SSII either...

Ukraine may but after NS2 is operational it will be a perfect reason (breach of contract) to stop transhipment via Ukraine or if no NS2 then stop supply like last time. Hence Ukraine unlikely to pull that stunt again.

I am sure they will do it in winter and claim it is to save lives and that they have a right to keep their people warm and besides Russia should be paying them more for transit fees and selling more gas to the EU so they get more money from the deal, and it is all Russias fault for them being poor and being unable to pay their bills. European courts have awarded Ukraine damages from Russia on that basis alone... I don't think it will change any time soon.

The German Consul General announced that it remains to complete 80 km of Nord Stream 2

EKATERINBURG, May 17. / TASS /. About 80 km of the pipeline remains to be built to complete the Nord Stream 2 project, German Consul General in Yekaterinburg Mathias Kruse told reporters on Monday.  "There are 80 km left to build <...> We assume that it will be completed," Kruse said, answering the question about how many kilometers of the pipeline are left to build under the project.

At the end of April, Russian Deputy Prime Minister Alexander Novak announced that the Nord Stream 2 gas pipeline would be completed in 2021. At the same time, the head of the State Duma Energy Committee Pavel Zavalny, at a meeting with the deputies of the German Bundestag on April 15, announced that Russia could complete the construction of Nord Stream 2 this summer and let the first gas flow towards Germany.

The Nord Stream 2 project involves the construction of two lines of a gas pipeline with a total capacity of 55 billion cubic meters. m per year from the coast of Russia through the Baltic Sea to Germany. The work was suspended in December 2019 after the Swiss Allseas abandoned pipe-laying due to possible US sanctions. Since December 2020, the construction of the gas pipeline has been resumed after a year's pause. The availability of Nord Stream 2 is currently 95%.

https://pfjbgez6p73iwpfidv5n6dqhdm-ac4c6men2g7xr2a-tass-ru.translate.goog/ekonomika/11388975?utm_source=finobzor.ru

German Regulator Gives Go-Ahead to Nord Stream 2 Construction in Exclusive Economic Zone

BERLIN (Sputnik) - Germany's federal maritime regulator on Monday ordered the construction of a 2-kilometre (1.2 mile) stretch of the Nord Stream 2 gas link in the country's exclusive economic zone.

"The Federal Maritime and Hydrographic Agency (BSH) ordered today the immediate implementation of the second modification permit for the construction and operation of the Nord Stream 2 pipeline for a 2-kilometre section in the German Exclusive Economic Zone," a press statement read.

Nord Stream 2 is a joint venture of the Russian energy company Gazprom and five European partners. It aims to construct a twin pipeline that will deliver up to 2 trillion cubic feet of Russian gas to Germany annually under the Baltic Sea. The United States is opposed to the project, seeking to export more of its liquefied natural gas to Europe.

The pipeline's construction was suspended in December 2019 after US sanctions forced Swiss pipelay company Allseas to withdraw from the project. The construction resumed last December and is 95% complete.

The acute gas shortage mentioned by Merkel is their need to replenish their storage, that was depleted last winter, at the same time as their current consumption.

Geo_monitor
@colonelhomsi
·
7h
German economy and energy minister Peter Altmaier, for his part, recalled that for almost half a century the Russians had been exporting energy to Germany and that the issue had never been a "political weapon in east-west relations"..

According to Merkel, they would like to complete the construction of Nord Stream 2 as soon as possible. The German Chancellor stressed on Sunday that Berlin is in favor of completing the project regardless of US sanctions..

German Chancellor Angela Merkel said Germany was facing an acute gas shortage and called for the construction of Nord Stream 2 to be completed as soon as possible. According to her, Berlin will support the completion of the project, regardless of US sanctions..

This Spring was colder than usual in Central Europe.

lancelot wrote:This Spring was colder than usual in Central Europe.

Indeed, that is why gas storage in Europe is at historically low levels, they were still extracting in April, unheard of. They have to get stocks up again in case next winter is bad too. Mind you, due to the Sun's lack of activity we are supposed to be heading for a period of global cooling like the middle 1600s so this could be just a foretaste of things to come.

From memory, in January they were running NS1 at 105% of its capacity averaged over the month. To say that the EU is dependent on Russian gas would be an understatement.

The fact is that they are dependent, and to its credit Russia has never used that as leverage against Germany.... a shame you can't say the same about German treatment of Russia...

If Russia did start using gas as a weapon of manipulation German is not obliged to continue to use their product... whether NSII is finished or not Germany can secure other suppliers, whether it is the US or some other producer.

The fact is that Russia is a reliable supplier and can manage the volumes that the entire EU requires.

The only people with their panties in a bunch over this could care less about EU energy security otherwise they would be supporting NSII and NSIII...

A bit more detail, it looks like the sanctions on Russians etc continue but not on German operations etc.

Amazon
@Amazon1Amazon
·
2h
NORD STREAM 2 Flag of Russia
The administration of US President Joe Biden will abandon plans to impose sanctions on Nord Stream 2 AG, the operator of the Nord Stream 2 gas pipeline, and its chief executive, Matthias Warnig (German).

The sources said the State Department will soon send its mandatory 90-day report to Congress with a list of organizations participating in the Nord Stream 2 project, against which it plans to impose sanctions.

The State Department, according to the sources, acknowledges that Nord Stream 2 AG (the legal entity in charge of the project) and its CEO are involved in sanctions activities. However, the State Department will refuse to apply these sanctions, citing the national interests of the United States.

However, sanctions will be imposed against several Russian vessels participating in the Nord Stream 2 project.

Biden administration sends muddled message on Nord Stream 2 pipeline

US foreign policy and their diplomatic community in general is a complete joke. They're so mired in their own self-inflicted russophobia and Russia-hating they cant even formulate a coherent strategy.

Russia should look at ways to respond in kind... perhaps trace individuals and organisations funding Navalny etc and impose some sanctions on them maybe.

I am sure Russia has a list of things it wants that it could use as a go to list to tick off each attack the US instigates against it.

GarryB wrote:Russia should look at ways to respond in kind... perhaps trace individuals and organisations funding Navalny etc and impose some sanctions on them maybe.

I am sure Russia has a list of things it wants that it could use as a go to list to tick off each attack the US instigates against it.

Russia already has. They barred not only the organizations like NED, but many of their handlers and associates. Even including US diplomats.

The US already sanctioned the vessels and companies. They can't sanctions them again and again. Doesn't even do anything anyway. US can't impound them either as most are escorted by Russian Navy.

The question now is... what concessions did the the US demand from Germany?

Germany arrests businessman over dual-use exports to Russia

My instinct is that on all other issues going forward Germany is to strictly toe the line like a loyal subservient as retribution for their intransigence regarding NS2. Expect Germany, especially if the Greens see power after elections, to be fighting for position with Poland and the Ukraine to be the US' #1 lapdog.