Optimizing Russian Natural Gas: Reform And Climate Policy by International Energy Agency

By International Energy Agency

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Presumably these consortia will determine the markets for their gas. Source : IEA. Major natural gas producing and prospective regions and pipelines 30 - RUSSIA’S NATURAL GAS CHAIN: OVERVIEW AND OUTLOOK Map 1 RUSSIA’S NATURAL GAS CHAIN: OVERVIEW AND OUTLOOK - 31 then part of the Soviet Union (see Map 1). With the depletion of its key Siberian fields and the prospect of more expensive production from its remaining assets, Gazprom’s upstream strategy was to draw on the cheaper gas in Central Asia by using existing pipeline infrastructure.

Gas production accounted for the remaining 14% of savings, and the processing, underground storage, drilling and capital repair of wells, 2%. 4% - - - GHG emissions from gas extraction to distribution Emissions of CH4, bcm Share of total Russian GHG emissions Sources: Silva et al. (2004), using VNIIGAZ information; Vernadskiy Foundation, 2004. RUSSIA’S NATURAL GAS CHAIN: OVERVIEW AND OUTLOOK - 45 As shown in Table 2, Gazprom projects a faster downward trend of its GHG emissions in the future with total emissions in 2008 falling to 71% of 1990 levels.

At present, the level of Russian imports from Turkmenistan is insignificant, accounting for less than 1% of total production. However, Gazprom’s plan for Turkmen volumes to increase dramatically must make Gazprom and the Kremlin uneasy about the terms and availability of supply – even if Europe appears quite relaxed. The IEA has long questioned the advisability of relying on contracts between Russia and Turkmenistan to meet future increases in European gas demand. These agreements and alliances formed with Central Asian countries allowed Gazprom to delay any competition in Russia while effectively removing Central Asian gas as a potential competitor in European markets.

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