Gazprom to Speed Up Gasification of Russian Regions

The Board of Directors addressed the issues of Gazprom’s participation in the Russian regions development.

The Board of Directors tasked the Management Committee to consider gasification a crucial sphere of activity as well as to update jointly with federal and regional authorities the Russian Regions Gasification Program until 2015 and, subsequently, until 2020, for which higher rates of natural gas supply to the population, industrial and agricultural sectors were needed.

Gazprom’s Gasification Program has a direct influence on the socioeconomic development of regions and living conditions. Between 2005 and 2010 Gazprom’s overall investments in Russian regions gasification exceeded RUB 115 billion, thus enabling to commission 1,048 gasification facilities. Natural gas arrived in 2,134 population centers. As a result, Russia’s average gasification level has grown 8.9 per cent – to 63.1 per cent by 2011.

In 2011 Gazprom allocates a record amount, over RUB 29 billion, for the Russian regions gasification. The Gasification Program covers 68 Russian constituents including the regions of Eastern Siberia, the Far East and the Krasnodar Krai being engaged in intense preparations for the major international events (2012 APEC Summit in Vladivostok, 2014 Olympic Games in Sochi, etc.). Gazprom will continue large-scale gasification efforts in Russian regions.

Gazprom’s investment policy centering on timely implementation of national objectives and tasks identified in the Russian Energy Strategy until 2030 is extremely enabling for the regional development. Between 2006 and 2010 the total capital investments under Gazprom’s investment programs exceeded RUB 2.41 trillion and around RUB 1.19 trillion of capital investments are planned for 2011.

Gazprom’s strategic activities include tapping the new gas production regions, namely, the Yamal Peninsula, Eastern Siberia, the Far East and the Arctic shelf. For instance, in Eastern Russia Gazprom is engaged in large-scale work under the state-run Eastern Gas Program. Five gas production centers will be set up in the region: the Sakhalin, Yakutia, Irkutsk, Krasnoyarsk and Kamchatka centers. The Company is implementing the Program for hydrocarbon resources development on the Russian Federation shelf until 2030. The Program will not only create new gas production centers in the Arctic and Far Eastern seas, but also advance the infrastructure of the Northern Sea Route.

Large-scale investment activity of Gazprom, construction and launch of new production facilities enhance the upgrading of industrial production and technologies, influence the qualification upgrading and vocation training of personnel, the regional job markets. According to forecasts, the average annual number of personnel engaged in industrial production until 2030 to execute the overall industrial order of Gazprom will exceed 350 thousand people.

The power industry development and the energy efficiency enhancement are Gazprom’s priorities in regions. The Group is one of country’s largest owners of power generating assets and allocates great amounts to new capacities creation. From 2007 to September 2011 Gazprom completed construction and modernization projects amounting to 3 GW of new capacity. It is planned to put into operation additional capacities of some 1 GW before the end of 2011.

Over several years Gazprom pursues the import substitution policy and increases the share of materials purchased from Russian producers. This share equals to 90 per cent today. Special attention is paid to the cooperation with Russian pipe manufacturers. As a result, since 2009 the total volume of large diameter pipes purchased by Gazprom from Russian producers has been maintained at 90 per cent.

Gazprom’s share in the Russian oil industry becomes more notable. Gazprom neft increases the volume of oil production in the YaNAO and develops some new fields in Eastern Siberia. The retail petroleum product sales segment is region specific. The grid of Gazprom neft’s filling stations covers 25 Russian regions. It is planned to spread to another 11 regions.

Gazprom is fruitfully cooperating with the Russian Federation constituents in the area of the natural gas market expansion (natural gas use as a motor fuel). Gazprom’s grid of CNG filling stations reached 206 units situated in 53 regions of the Russian Federation.

Gazprom Group is a key taxpayer in the Russian Federation. In 2010 the tax payments to the federal budget amounted to RUB 424 billion, to the regional and local budgets – over RUB 270 billion. At the same time, Gazprom is one of the major taxpayers in a number of the Russian Federation constituents, such as the Yamal-Nenets Autonomous Okrug, the Khanty-Mansiysk Autonomous Okrug – Yugra, the Astrakhan Oblast and Moscow.

[mappress]

LNG World News Staff, November 30, 2011; Image: Gazprom