Gazprom is set to start up its major Power of Siberia gas pipeline to China that aims to deliver 38 billion cubic metres (bcm) of gas a year by 2025.
The firm is set to supply 5 bcm next year, 10 bcm in 2021 and 15 bcm in 2022, a Gazprom official said, adding China must buy at least 85% of these volumes based on the supply contract.
Gazprom expects annual exports to Europe to be around 194-204 bcm in the next four to five years, compared with 198 bcm this year.
It said it had supplied 53.5 bcm to Europe and destinations other than Russia and the ex-Soviet Union in the third quarter, down from 56.9 bcm in the same period a year ago.
Gross revenue from gas supplies to Europe and destinations excluding Russia and ex-Soviet states was 587 billion roubles, down 37% year on year, as average gas prices fell to $169.8 per 1,000 cubic metres (cm) from $250.8 per 1,000 cm in the third quarter of 2018.
Gazprom said total sales were 1.6 trillion roubles in the third quarter, down from 1.9 trillion in the same period a year ago. Net debt was 2.86 trillion roubles at the end of September.
8----French Gas Storage Brimming Ahead of Winter
France has sufficient gas in storage to see it through winter even in the event of an exceptionally cold snap, thanks in part to a sharp increase in the flow of liquefied natural gas (LNG), network operators GRTgaz and Terega said.
French gas storages are filled to the brim at 129 terawatt hour (TWh), their highest level in nine years, the operators said.
France has become an attractive destination for LNG flows and transit thanks to the completion of a pipeline linking north and southern France, its storage networks, LNG terminals and a unified gas market.
The operators said the completion of the Val de Saone gas pipeline and the creation of the single market Trading Region France last year, boosted French gas transit capacity by 42%, and smooth out the price difference between north and southern France.
LNG flows through the French network doubled in the past year, reaching 211 TWh at the end of October.
The operators said the influx of LNG helped push the French PEG gas price to its lowest since 2009 at below 8 euros ($8.82) a megawatt hour (MWh) in September.
“We are not worried about winter,” Thierry Trouve, director general of GRTgaz, a unit of Engie, told a news conference. “Storages are full, and we can also send gas to Spain, Italy or Switzerland without any restrictions.”
9--- Siberian Gas to Test CNPC's Marketing Mettle
Across China’s coal-burning northeastern provinces, pipelines are being laid, contracts signed and coal-fired boilers ripped out ahead of the arrival of the country’s first piped natural gas from Russia.
The ‘Power of Siberia’ pipeline, due to open on Dec. 2, will pipe natural gas around 3,000 km (1,865 miles) from Russia’s Siberian fields to the fading industrial region, which has lagged the push to gas in China’s south and east.
The pipeline - which will deliver gas under a 30-year, $400 billion deal signed in 2014 - has the potential to transform northeast China’s energy landscape and even slow the country’s surging imports of liquefied natural gas (LNG).
It will also make Russia a key supplier to China, to rival Turkmenistan and Australia, boosting ties amid Beijing’s trade war with the United States.
More immediately, it poses a challenge for the sole marketer of the gas, China National Petroleum Corp (CNPC), or PetroChina, as it looks to drum up demand in the relatively sparsely populated region that has relied on coal for heating during sub-zero winters.
The pipeline will emerge in Heilongjiang, which borders Russia, and feed on to Jilin and Liaoning, China’s top grain hub, where rust belt industries have long been overshadowed elsewhere.
The region’s industry and 68 million city dwellers consume just 14 billion cubic meters (bcm) of gas a year, well below the 38 bcm the pipeline will deliver at full capacity by 2025.
Russia’s Gazprom has said it expects to supply 4.6 bcm in 2020, rising to 10 bcm in 2021, 16 bcm in 2022, 21 bcm in 2023 and 25 bcm in 2024.
With local power prices capped by authorities to support manufacturing, and cheaper imported coal available via Liaoning’s Dalian port, CNPC faces a tough task to sell gas.
“It will take a long time to nurture a market in the northeast where gas-fired power generation barely exists and the industrial sector is weak,” said Li Yao, chief executive of consultancy SIA Energy.
“With no take-or-pay contracts in place (domestically), CNPC shoulders most of the marketing risk.”
Neither PetroChina nor Gazprom has revealed the gas pricing terms, but Beijing-based analysts said the price is linked to crude oil or a basket of competing fuels.
Ling Xiao, a PetroChina vice president in charge of gas marketing, said last month Siberian supplies would be priced “slightly lower” than piped imports from Turkmenistan, but the company “will still be making a loss as (the price) exceeds that of domestic city-gate benchmark rates.”
Several Russian gas industry sources said the pricing could be revised down as volumes increase due to a fall in global oil prices from around $100 a barrel when the deal was signed to around $60 now.
However, the pricing formula remains known by only a few due to its commercial sensitivity, according to one source. Gazprom said it will not comment on pricing.
PetroChina declined to comment on the pipeline or its plans to boost gas take-up.
However the company, which supplies 70% of China’s gas, has been working for the past five years to put distribution infrastructure in place.
A 3,371 km (2,095 mile) trunkline linking the arrival point in Heihe to Shanghai is being laid in phases and slated for completion by 2024, state media reported.
10----Greece Eyes €44bn for Clean Energy
Greece hopes to generate investment worth about 44 billion euros ($49 billion) over the next decade on projects to reduce its dependence on fossil fuels, authorities said.
A gameplan approved by the cabinet showed Greece will try to reduce its carbon footprint by more than 55 percent by 2030 compared with 2005, and would close down all its coal-fired power plants in the next eight years.
Wind, solar and hydroelectric power should account for at least 35 percent of energy consumption by then, up from about 15 percent in 2016, with investments worth about 9 billion euros. Other investments include natural gas networks and in recycling projects.
Athens expects this investment to consist largely of government spending, combined with European Union funds and foreign investment.
Oil and gas imports account for more than 65 percent of total energy consumption in Greece.
“Climate change is here and we are living with the consequences on a daily basis,” Environment and Energy Minister Kostis Hatzidakis told journalists.
The country will invest about 2 billion euros in the next 10 years to help tackle natural disasters from climate change like floods and forest fires.
Torrential storms caused flash floods and the deaths of three people, while forest fires are common in Greece. In its worst tragedy, 102 people died when a fire ripped through the coastal village of Mati in July 2018.