Methane to remain most cost-effective option for infrastructure expansion and most affordable fuel for consumers over next decade

A session titled “Towards a Sustainable Future: a Green Alternative to Traditional Fuel” took place at the St. Petersburg International Economic Forum 2022. The session was opened by Viktor Zubkov, Chairman of the Gazprom Board of Directors, Russia's Special Presidential Representative for Cooperation with the Gas Exporting Countries Forum.

Also taking part in the event were Yury Borisov, Deputy Prime Minister of the Russian Federation, Igor Levitin, Aide to the President of the Russian Federation, and Nikolai Shulginov, Minister of Energy of the Russian Federation.

In his speech, Viktor Zubkov noted that the past decade has seen the successful creation of a competitive market for natural gas as a vehicle fuel in Russia. Today, a total of 669 methane refueling stations operate nationwide. Among the regions spearheading the development of the NGV market are the Republics of Tatarstan and Bashkortostan, the Krasnodar Territory, and the Rostov, Volgograd and Samara Regions. Gazprom has the largest refueling capacities for compressed natural gas and is capable of providing half a million cars with fuel right now.

Some RUB 100 billion have already been invested in the sector. Out of this amount, Gazprom accounts for RUB 35 billion. However, the national average for the use of refueling stations is only at 36 per cent of the available capacity. The situation could be improved through substantive governmental support on the federal and regional levels. Viktor Zubkov highlighted the need to increase subsidies for the construction of new stations and converting vehicles to natural gas.

The key priorities of further NGV market development mentioned by Viktor Zubkov include the creation of NGV refueling infrastructure on key federal highways. Gazprom has built 11 such facilities by now, and another 50 new stations are planned to be constructed on highways before the end of 2024.

“In Russia, the use of methane as a vehicle fuel during the transition period – until the end of the 2030s – will remain the most cost-effective option in terms of infrastructure expansion and the most affordable fuel for consumers. Nothing as cheap is going to emerge in the near future. Natural gas is something that can spur economic development in our country,” said Viktor Zubkov.

He also noted that, taking into account the rates of gas grid expansion in Russian regions, it will be possible to build NGV refueling stations across the entire country by 2030 while methane consumption in the NGV sector is expected to reach 10 billion cubic meters. Considering the unparalleled abundance of Russia's natural gas reserves, this is the most advantageous green alternative to conventional fuels for our country. There are great prospects for the use of methane in all kinds of transport – road, rail and waterborne alike.