Gasification
Starting from 2001, Gazprom has been adopting regional gasification programs. Gasification of Russian regions is carried out jointly by Gazprom and federal constituents’ authorities. Thus, the Company finances construction of the inter-settlement gas pipelines delivering gas to population centers, while regional authorities take on street networks laying and preparation of consumers for gas supplies.In order to ensure efficient execution of the gasification program, Gazprom and federal constituents’ authorities enter into agreements of cooperation and accords on gasification. The Company and regional authorities annually approve the scope of work and the respective deadlines provided for in synchronization schedules for constructing the gasification facilities designated to connect consumers as soon as Gazprom completes the inter-settlement gas pipelines.
When selecting where to deploy gasification activities, Gazprom takes the following factors into account:
- gasification level of the region;
- region’s capability to share gasification costs;
- defaulted payments for current gas supplies;
- absence of unsanctioned gas consumption in excess of the preset limits.
In 2005 Gazprom considerably intensified the activities aimed at increasing regional gasification in Russia. Between 2005 and 2008 the Company allocated over RUB 72 billion to construct inter-settlement gas pipelines. These funds were used to build 696 inter-settlement gas pipelines with the total length of more than 11,000 kilometers.
Over the four years the average gasification level was raised to 62 per cent throughout Russia including to 67 per cent (6 per cent increase) in cities and towns and to 44 per cent (8 per cent increase) in the rural area.
In 2009 Gazprom earmarked RUB 19.31 billion for the gasification of 69 Russian regions. The Company completed construction of 189 inter-settlement gas pipelines with the total length of 3.2 thousand kilometers, which will ensure gas supply to 447 residential centers in 45 regions of the Russian Federation.
In 2010 RUB 25 billion is slated for investment in gasification.
In December 2009 the updated Concept for Gazprom’s participation in the Russian Federation regions gasification was approved. The Concept stipulates a differentiated approach to the gasification process depending on the existence and the development level of natural gas reserves in the regions, as well as the use of fuel alternatives including liquefied and compressed natural gases (LNG and CNG), and liquefied petroleum gas (LPG).
The Concept divides the regions into three groups basing on the level of the natural gas infrastructure development, envisages triennial gasification planning for each region and introduces new safety standards. Special attention is paid to the gasification of the population centers that are sparsely inhabited and detached from gas trunklines, which is especially important for the rural area.
Further efforts of Gazprom will be aimed at achieving the maximum economically viable level of gasification in Russia. Gas supply to Eastern Siberia and the Far East is currently among the Company’s paramount objectives that will be met simultaneously with creating the production and transmission infrastructure in these regions.