Russia’s gas exports to Europe and Turkey rose by 8.1% to a record high 193.9 billion cubic meters (Bcm) in 2017, Alexei Miller, head of Gazprom, said in a statement on Jan. 3, despite EU efforts to cut its reliance on Russian energy.
Gazprom, run by Miller, a close ally of Russian President Vladimir Putin, supplies more than a third of the European Union’s gas.
However, the European Commission has called on EU member states to curb their reliance on Russian energy following Moscow’s 2014 annexation of Crimea from Ukraine and a clash over gas deliveries between Kiev and Moscow that saw Gazprom cut off supply.
“The rising trend of the record-high data for the second year in a row shows, on one hand, a rising demand for the Russian gas in Europe, and on the other hand, its secure supply in necessary volumes,” Miller said.
Gazprom said its gas deliveries to its largest customer, Germany, jumped by 7.1% to 53.4 Bcm last year, a new record high.
Its 2017 gas production, the world’s largest, rose by 12.4% to 471 Bcm, Miller said.
To help safeguard its market share, Gazprom has quietly agreed price deals with big customers and caved in to EU rules it once flouted. Gazprom sources said they have drawn lessons from recent defeats on the European gas market.
Lithuania, which began importing LNG from Norway in 2014 and became the first ex-Soviet state to buy U.S. natural gas in August, refused to renew its contract in 2015.
The company faces more trouble, analysts said, as its major long-term contracts expire between 2021 and 2035.
Poland, a gas client since 1944, has said it will not renew its contract in 2022.
Gazprom only exports its pipelined gas westward. It plans to start selling gas to China to the east in December 2019 with annual volumes peaking at 38 Bcm via the Power of Siberia pipeline, which is under construction.
In Asia Gazprom faces competition from Russia’s top non-state gas company, Novatek, which started selling seaborne liquefied natural gas from its YAMAL LNG project last month.
Recommended Reading
Enbridge Announces $500MM Investment in Gulf Coast Facilities
2024-03-06 - Enbridge’s 2024 budget will go primarily towards crude export and storage, advancing plans that see continued growth in power generated by natural gas.
Pembina Pipeline Enters Ethane-Supply Agreement, Slow Walks LNG Project
2024-02-26 - Canadian midstream company Pembina Pipeline also said it would hold off on new LNG terminal decision in a fourth quarter earnings call.
TC Energy's Keystone Oil Pipeline Offline Due to Operational Issues, Sources Say
2024-03-07 - TC Energy's Keystone oil pipeline is offline due to operational issues, cutting off a major conduit of Canadian oil to the U.S.
TC Energy’s Keystone Back Online After Temporary Service Halt
2024-03-10 - As Canada’s pipeline network runs full, producers are anxious for the Trans Mountain Expansion to come online.
Enbridge Fortifies Dominant Role in Corpus Christi Crude Transport
2024-03-20 - Colin Gruending, Enbridge executive vice president and president for liquids pipelines told Hart Energy the company’s holdings in South Texas are akin to a “catcher’s mitt” for Permian and Haynesville production.