Construction begins on Complex for processing ethane-containing gas near Ust-Luga

RELEASE

Today, construction began on the Complex for processing ethane-containing gas (CPECG) near the settlement of Ust-Luga in the Leningrad Region. The CPECG is the only cluster of this kind in the world, combining capacities for gas processing, gas chemistry, and natural gas liquefaction.

Taking part in the ceremonial event were Alexander Novak, Deputy Prime Minister of the Russian Federation, Alexey Miller, Chairman of the Gazprom Management Committee, and Konstantin Makhov, Chief Executive Officer of RusGazDobycha. Alexander Drozdenko, Governor of the Leningrad Region, and Igor Shuvalov, Chairman of VEB.RF, attended the ceremony as guests of honor.

Left to right: Alexander Drozdenko, Igor Shuvalov, Alexey Miller, and Alexander Novak
Left to right: Alexander Drozdenko, Igor Shuvalov, Alexey Miller, and Alexander Novak

Left to right: Alexander Drozdenko, Igor Shuvalov, Alexey Miller, and Alexander Novak

The CPECG will consist of two major enterprises. The first of them is the integrated complex for natural gas processing and liquefaction (the Gas Processing Complex, or the GPC of CPECG; the project operator is RusKhimAlyans, a joint venture of Gazprom and RusGazDobycha). The second one is the gas chemical complex technically affiliated with the GPC (the GCC of CPECG; the project operator is Baltic Chemical Complex, a subsidiary of RusGazDobycha).

Alexander Novak speaking
Alexander Novak speaking

Alexander Novak speaking

The GPC of CPECG will have the largest capacity in Russia and one of the largest in the world in terms of gas processing (45 billion cubic meters per year), and will be the leader in northwestern Europe in terms of liquefied natural gas production (13 million tons of LNG per year). The gas remaining after the processing will go into Gazprom’s gas transmission system in the amount of approximately 18 billion cubic meters per year.

Among the GPC’s most important marketable products will be ethane, a valuable raw material for the gas chemical industry. Ethane fraction will be supplied to the GCC of CPECG. The GCC will have a capacity of over 3 million tons of polymers per year – the largest output by a single facility worldwide.

The feedstock for the Gas Processing Complex will come in the form of high ethane-content natural gas. Initially, this gas will be delivered to the enterprise from fields in the Nadym-Pur-Taz region of the Yamal-Nenets Autonomous Area, and later on it will also be produced at Tambeyskoye, the richest field in the Yamal Peninsula. The gas will be transmitted via gas trunklines specially allocated for ethane-containing gas.

“Here in the northwestern part of Russia, in the Leningrad Region, we have launched the construction of a fundamentally new and high-tech industrial cluster. It is essential for the region and the country at large. Advanced processing is the most efficient way to maximize the potential of the immense reserves of ethane-containing gas in Russia,” said Alexey Miller.

Alexey Miller speaking
Alexey Miller speaking

Alexey Miller speaking

“The creation of the gas chemical complex as part of the CPECG is a unique project for Russia, enabling us to manufacture high-margin products and double the exports of domestic polymers. The project will gather together a huge team from all over Russia: we’ll invite the greatest brains and hands available, and we’ll engage the best foreign specialists,” said Konstantin Makhov.

Konstantin Makhov speaking
Konstantin Makhov speaking

Konstantin Makhov speaking

“VEB.RF in partnership with Gazprom and RusGazDobycha is taking part in the preparation and launch of the project in Ust-Luga, one of the world’s largest. The financing from VEB.RF has made it possible to start onsite works in a timely fashion. Crucially, the project is based on the principles of responsible investment and the ESG agenda. The comprehensive results of its implementation will have a positive impact on the quality of life in the Leningrad Region and the development of a modern urban environment in Kingisepp,” said Igor Shuvalov.

Gazprom and RusGazDobycha signed the Master Agreement on the implementation of a joint project for the development of the Tambeyskoye field.

Ongoing teleconference
Ongoing teleconference

Ongoing teleconference

Under said Master Agreement, Gazprom Nedra (a wholly-owned subsidiary of Gazprom) and RusGazDobycha are on a parity basis setting up a joint venture, Tambey Gazdobycha, holding subsurface use licenses for the area where the Tambeyskoye field is located.

The joint venture will be responsible for the pre-development and development of the Tambeyskoye field. Gas production from Tambeyskoye will commence in 2026.

In addition, RusKhimAlyans (the operator of the GPC of CPECG) and Linde signed an Agreement of Strategic Cooperation, which covers advanced processing and liquefaction of natural gas, gas chemistry, as well as creation and development of promising technologies.

The Agreement provides for the implementation of a set of measures aimed at creating and implementing jointly developed technologies, as well as localizing the production of equipment and materials used in the construction of natural gas liquefaction and processing facilities. Another line of cooperation is the development of innovative technologies for advanced processing of gas, including those involving synthetic hydrocarbons production.

A contract for services was also signed between Gazprom Neftekhim Salavat and RGD Pererabotka Salavat (a subsidiary of RusGazDobycha) pursuant to which the managing company of RGD Pererabotka Salavat shall perform the functions of the sole executive body of Gazprom Neftekhim Salavat.

Background

The Tambeyskoye field in the Yamal Peninsula is located within three Gazprom-owned licensed blocks: Severo-Tambeysky, Zapadno-Tambeysky, and Tasiysky.

The field’s reserves amount to over 5.2 trillion cubic meters of gas and 380 million tons of oil and gas condensate.

 

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