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Gazprom may ditch Shtokman pipe gas

Gazprom Neft platform Prirazlomnoye
Gazprom prepares for Barents drilling to increase natural gas production. Photo: Thomas Nilsen

All natural gas from the huge field in the Barents Sea can be liquefied according to Deputy Chief Executive Aleksandr Medvedev.

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It is Interfax that quotes Gazprom’s Medvedev saying belief in liquefied natural gas (LNG) came back to our partners. Gazprom’s partners in Shtokman Development are French Total and Norwegian Statoil. The statement comes just a week after the Shtokman partners once again postponed the final investment decision.

Dropping European demand for natural gas following the financial crisis and increasing Asian demand for LNG could be driving forces in Gazprom’s shifting Shtokman strategy. A Moscow political shift from supplying Europe to more Asia focus could be another explanation.

Dow Jones Newswires is simultaneously citing unnamed sources familiar with the strategy shift saying the revamp of the technical design could mean another delay by at least another year. The March postponement was set to July 1.

“Everything is on the table now, even the possibility of Gazprom working with other foreign partners or maybe continuing the project on its own,” the source says to Dow Jones.

Press contact Bård Glad Pedersen in Statoil says to E24 in Norway that he will not elaborate on possible shifts in Shtokman strategy. “We agree to continue to make preparations for the project, economically and technically.”

Prime Minister Vladimir Putin said in March that Russia should wean itself off its dependency on gas supplies to Europe via pipelines. Putin said he wanted more gas deliveries to Europe, Asia and the Middle East to be shipped with LNG-tankers.

An LNG plant for the Shtokman gas will be built in Teriberka on the coast of Russia’s Kola Peninsula and can be the largest industrial investment project north of the Arctic Circle ever.