In a recent board meeting, Gazprom directors discussed possible changes in the global gas market. Gazprom highlighted that the development of the industry is increasingly tied to the enhanced energy security specified by rising investments needed for the gas infrastructure expansion, as well as to geopolitical issues.
European gas demand
Most scenarios envision that Europe, the priority market for Gazprom, will face a long-term growing gas demand with declining domestic gas production. The consumption rates may be increased through reviving the role of natural gas in the power sector, combined with a wider use of NGVs (natural gas vehicles) and gas-powered marine vessels. This increase in demand will boost the imports of pipeline gas and LNG.
Another further trend highlighted in a number of scenarios is heightened capital and operational expenditures for new international LNG projects. The situation is complicated by government initiatives aimed at limiting LNG export in a number of countries that can potentially provoke the gas and LNG deficiency in the global market.
Gazprom noted that in this situation, the buildup of gas supplies to Europe through Nord Stream and South Stream, as well as LNG projects in the Baltic Sea and the Far East will allow the group to meet the high demand of European consumers, and to secure additional Russian gas amounts for the premium Asia-Pacific market.
Adapted from press release by Katie Woodward
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