Gazprom will invest 900 billion rubles in new gas pipelines from Yamal

Monopoly is rapidly developing gas transportation from Yamal.
Gazprom can accelerate its most ambitious construction of the last decades. The monopoly plans another expansion of gas pipelines for the supply of gas from Yamal: the third line Bovanenkovo ​​— Ukhta and Ukhta — Torzhok with an estimated cost of 900 billion rubles. These projects are taken into account in the plan for the development of backbone infrastructure until 2024, which will soon be approved by the government. Pipes are needed to bring new fields to the market amid rising exports and a possible new contract with China.

In the coming years, Gazprom can build a third line of gas pipelines through which gas from Yamal follows, from a comprehensive plan for the development of trunk infrastructure until 2024 (Kommersant has). We are talking about the third line Bovanenkovo-Ukhta (69 billion cubic meters, 1,110 km) and the third line Ukhta-Torzhok (45 billion cubic meters, 973 km). The launch date for Bovanenkovo ​​— Ukhta is designated in the plan as 2023. The document was approved on September 24 at a meeting of the Presidential Council for Strategic Development under the Russian Federation; according to Kommersant’s data, an order of the government is expected soon.

Thus, Gazprom intends to accelerate the development of the northern gas transmission corridor from Yamal, which began construction in 2008. Since then, the first two stages of the Bovanenkovo-Ukhta have been commissioned (115 billion cubic meters per year, this corresponds to the projected production capacity at the Bovanenkovo ​​field, to which it should be put out by the end of the year). Gazprom also expanded gas pipelines to Torzhok and is completing the construction of the second stage of the Ukhta-Torzhok gas pipeline by 45 billion cubic meters, from where gas will be supplied to the Nord Stream-1 and Nord Stream-2 gas pipelines.
In the monopoly, “Kommersant” confirmed that it “is carrying out design work to expand the capacity of the northern gas transmission corridor taking into account the development of the Yamal gas production center”, but “it’s still premature to talk about the timing of the construction of new gas pipelines.”

The northern corridor is the main and most expensive construction site of Gazprom over the past 15 years. Two stages of Bovanenkovo ​​— Ukhta cost 990 billion rubles. in 2008 prices - according to “Kommersant” on the basis of Gazprom’s reports, this is at least 1.3 trillion rubles. in actual prices. The two Ukhta-Torzhok lines cost a total of 449 billion rubles. in prices of 2010 and 2011, respectively, their total actual cost, according to Kommersant's estimate, may be at least 550 billion rubles. Based on the previous costs, the third phase of the gas pipeline from the Yamal may cost about 900 billion rubles.

New pipeline capacities are needed for Gazprom to supply additional volumes of Yamal gas, primarily from the Kharasaveysk field, which is scheduled to be launched in 2023 with an output of 32 billion cubic meters in the years 2026-2027. In addition, Gazprom intends from 2025 to gradually introduce into the development of the Bovanenkovo ​​neokom-Jurassic deposits, which will add another 25 billion cubic meters per year to the total production of the field. Yamal gas is needed because production in the traditional region of Nadym-Pur-Taze production is declining, says Alexey Grivach from the NESF.

Against the background of record gas supplies for export and the restoration of positions in the domestic market, Gazprom, with its current production capacity, is no longer as free as it has been in recent years, covering peak consumer needs. Under these conditions, the monopoly is already thinking about stepping up gas purchases in Central Asia. Back in the 2000s, Gazprom acquired in Turkmenistan up to 80 billion cubic meters of gas per year, then sharply reduced the volume of purchases and from 2016 completely stopped them. Since then, the monopoly has acquired only about 4 billion cubic meters of gas per year in Uzbekistan. But on October 9, during a visit to Turkmenistan, the head of Gazprom, Alexei Miller, told the local TDH agency that the monopoly expects to reach an agreement on resuming purchases of Turkmen gas from 2019.

An additional motive for Gazprom could be the desire to reduce the supply of Turkmen gas to China in order to sign the contract for deliveries to the PRC through Altai, these negotiations have recently intensified. If the contract is signed, the need for Gazprom in Yamal gas, not only for export to Europe, but also for supplying Central Russia, will grow, since Nadym-Pur-Taz gas will partially go south in the direction of the PRC.

At the same time, expensive new construction may once again prevent the management of Gazprom from fulfilling its promises to investors regarding the growth of dividends. Until now, the company has said that the growth of payments is possible after 2020, when the investment program of Gazprom, due to spending on Nord Stream 2, Power of Siberia and Turkish Stream, should start to decline.