Domestic Gas Sales in Details
Gazprom's marketing strategy for the domestic market is mainly targeted at ensuring sustained gas supplies in the country while increasing sales profitability.
Russian gas market
Russia is the largest and potentially most attractive gas market for Gazprom. The Gazprom Group sells more than half of its gas domestically. In 2018, the Group sold 239.7 billion cubic meters of gas in Russia, with the net revenue from domestic gas sales (net of VAT) reaching RUB 954.5 billion.
Russian natural gas market in 2018
Year ended December 31
* The data were not derived from financial statements and were calculated based on exchange rates as of the end of the relevant period.
In accordance with Russia's current legislation, gas prices for end consumers are subject to state regulations and differentiated by consumer groups (population and industries) and price zones depending on the distance of transmission from producing regions to consumers.
Regulatory framework for Russian gas market
- Russian Government Directive No. 239 (as amended and supplemented) on Measures to Streamline State Regulations for Prices (Tariffs) dated March 7, 1995;
- Russian Federal Law No. 147-FZ on Natural Monopolies dated August 17, 1995;
- Russian Government Directive No. 162 on Approval of Rules for Gas Supplies in the Russian Federation dated February 5, 1998;
- Russian Federal Law No. 69-FZ on Gas Supplies in the Russian Federation dated March 31, 1999;
- Russian Government Directive No. 1021 on State Regulations for Gas Prices and Transmission Service Tariffs in the Russian Federation dated December 29, 2000;
- Russian Government Directive No. 335 on Setting Special Charges for Transmission Tariffs by Gas Distribution Companies to Finance Gasification Programs dated May 3, 2001;
- Russian Government Directive No. 333 on Improvement of State Gas Price Regulations dated May 28, 2007;
- Russian Government Directive No. 1205 on Improvement of State Gas Price Regulations dated December 31, 2010;
- Russian Government Directive No. 323 on Natural Gas Trading at Commodity Exchanges and Amendments to the Acts of the Russian Government Regarding State Regulations for Gas Prices and Access to the Gas Transmission System of Open Joint Stock Company Gazprom dated April 16, 2012;
- Russian Government Directive No. 1663 on Certain Aspects of Gas Sales in the Russian Federation dated December 27, 2017;
- Russian Government Directive No. 1282 on Certain Aspects of Gas Sales in the Russian Federation dated October 29, 2018;
- Russian Government Directive No. 1442 on Updating and Revoking Certain Acts of the Russian Government Regarding State Regulations for Gas Prices dated November 30, 2018.
Development of natural gas trading
Seeking to develop the Russian gas market, Gazprom ramps up the sales of its gas at the St. Petersburg International Mercantile Exchange (SPIMEX). In 2018, the amount of natural gas supplied as a result of Gazprom's transactions on SPIMEX totaled 13.6 billion cubic meters.
Gazprom is the leader of Russia's gas distribution sector.
As of late 2018, the Gazprom Group's gas distribution subsidiaries and affiliates owned and operated 786,700 kilometers of gas distribution networks in the Russian Federation.
Gas distribution pipelines length in Gazprom Group, thousand kilometers