The proposed article covers the implementation by Gazprom company of the “Eastern Gas Program.” The combining of the European and Asian parts into a single economic entity is the most important ’s task — not only an economical but also a political one. And our future will depend on how successfully we are able to solve this task. Rather significant contribution to the integration of Russia is being made by Gazprom company connecting our country by its pipelines.

Gazprom’s Strategy in the East of Russia

Yu. Kuznichenkov

Vladimir Putin and Alexei Miller at the ceremony of putting into operation of the first gas transportation system start-up complex — Khabarovsk — Vladivostok

he Government and President of the Russian Federation federal districts — Siberian and Far-Eastern. The area T are aiming to turn our country into one of the global of this region amounts to 10,300,000 square kilometres economy leaders and to reach the social and economic (60.5 percent of the Russian Federation). However, only development level of the highly industrialized states. In 16,300,000 people inhabit that huge territory (11.3% of the particular, by 2020 Russia is going to become one of the country’s population). top five countries in terms of economic power, i.e. gross The region’s natural resources are rich and diverse, but domestic product. still not sufficiently used. In order to use the natural resources An important part in the solution of these tasks belongs of the East of Russia efficiently we need energy: energy of to the East of Russia (Eastern Siberia and the Far East). This thought, energy of action; we need energy resources and region comprises 18 constituent entities of the two Russia’s power engineering.

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North of Krasnoyarsk Yakutsk the tyumen center center region RUSSIA

Proskokovo irkutsk KRASNOYARSK center

Kemerovo Tynda SaKhalin Omsk Taishet Skovorodino Center Barnaul Novokuznetsk Gorno-Altaysk Irkutsk

Khabarovsk MONGOLIA Yuzhno-Sakhalinsk ULAN BATOR DAQING To USA ALMA-ATA Vladivostok

BISHKEK BEJLING PYOHGYANG CHINA SEUL TOKIO

ISLAMABAD NANJING JAPAN SHANGHAI DELHI

principal scheme of the integrated gas supply system in the east of russia

gas production centers active pipelines pipeline gas lng

“The Energy Strategy of Russia for the Period of up to 2020” approved by the Government of the Russian Sea of okhotsk

Federation entrusted the gas industry with the following Sakhalin 3 tasks related to the East of Russia: fast development of the industry; formation and development of new large gas producing districts and regions; Russia’s entry into gas

markets of the Asia-Pacific Region. Sakhalin 4 okha The solution of these tasks is imposed on the Eastern nikolyaevsk- Gas Program (formal name — Development Program for on-amur an integrated gas production, transportation and supply Sakhalin 1 piltun system in Eastern Siberia and the Far East, taking into Sakhalin 2

account potential gas exports to China and other Asia- Sakhalin 1 Pacific countries) adopted by the Government of the Russian boatasino Federation on September 3, 2007. nogliki Sakhalin 3 The main purpose of the program is to establish efficient nysh

gas industry in the East of Russia and thus to create Kirinskoye deposit conditions necessary for rapid social and economic growth Aleksandrovsk of the region, for improvement of living standards of the local Sakhalinsky population. Strait of pacific okean The scope of the program planned up to the year of 2030 tartary may be illustrated by the following figures: more than 2.4 Sakhalin trillion rubles is required for the program implementation; total macroeconomic effect of the program implementation is estimated at 27.8 trillion rubles; tax revenues of the federal and regional budgets of the Russian Federation for the entire period of the program implementation will amount Ilyinsky to nearly 3,8 trillion rubles; the program implementation in Sea of okhotsk the period of 2015–2030 will provide for additional GDP growth in the East of Russia — from 3.5 to 13.4% per year; yuzhno-sakhalinsk the total natural gas export via pipelines may amount up Prigorodnoye to 50 billion cubic meters, and the volume of LNG supply to Asia-Pacific countries may amount to at least 28 billion Sea of cubic meters. japan

12 № 5/40 2012 In accordance with the decisions of the Government of the Russian Federation, the Development Program for an integrated gas production, transportation and supply system in Eastern Siberia and the Far East, taking into account gas exports to China and other Asia- Pacific countries is now being implemented, Gazprom acting as the coordinator. The program is a fundamental document defining the long-term strategy of gas industry development in the East of the country and includes a set of interrelated activities, the implementation of which (in accordance with the approved parameters) will, in addition to the construction of “Eastern Siberia — Pacific Ocean” pipeline system, enable to significantly increase the level of social and economic development of the Far East of Russia, and also provide for the Russian natural gas markets’ diversification and for protection of Russia’s geopolitical year. The “big” gas will radically change the local economy interests. structure, which will certainly influence on the constituent entity’s financial state. The natural gas resources available in the Eastern Siberia and in the Far East allow to satisfy the demand of the Russia’s The Sakhalin island shelf is best prepared for gas eastern regions and also to secure export deliveries in the production and supply to consumers in the Russia’s Far East. long term. The initial aggregate gas resources of the East Gazprom company is participating in Sakhalin-2 project as of Russia account for 52.4 trillion cubic meters onshore and its main shareholder. Russia’s first liquefied natural gas plant 14.9 trillion cubic meters offshore. was constructed within the framework of this project, and LNG is now being supplied to foreign consumers. The plant The Eastern gas program provides for the following stages reached its design capacity in 2010. of development of gas resources of the Eastern Siberia and Far East and the following principal scheme of development Sakhalin-3 is another large project developed by of the region’s gas transmission system: Gazprom company. The company holds licenses for Kirinsky, Vostochno-Odoptinsky and Ayashsky blocks, and Stage one — establishment of the Sakhalin gas also for Kirinskoye deposit; Gazprom has already started production center. development of the deposit. For the first time in Russia such Stage two — establishment of the Yakutia gas production offshore production method and process will be applied center. that involve use of subsea production complexes — not Stage three — establishment of the Krasnoyarsk gas platforms but subsea production complexes. Moreover, for production center. the first time in Russia the offshore production will be carried Stage four — establishment of the Irkutsk gas production out using subsea production complexes — not platforms center. but subsea production complexes. A separate part of the Eastern gas program is presented by In September of 2010, the company discovered a new the Sakhalin region, where the demand for gas is incredibly deposit within the Kirinsky block — Yuzhno-Kirinskoye high. That is why the company pays so much attention to deposit with the gas reserves of 260 billion cubic meters. Sakhalin offshore projects; for instance, Kirinskoye deposit Gazprom company is also constructing Sakhalin — will be placed under production as early as in the next Khabarovsk — Vladivostok gas transport system (GTS)

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exploration activities are carried out on 18 license blocks. In 2005, Beryambinskoye field was discovered. In the Irkutsk region, the exploration works are carried out on 5 license blocks. Chikanskoye field has been discovered. “General scheme for gas supply and gasification of the Irkutsk region” has been developed and is now implemented. The scheme involves the development of a model of Gazprom company’s cooperation with independent subsurface users holding licenses for the development of small and medium-size fields. In the Krasnoyarsk Territory, works on the exploration of the Sobinskoye field oil rims are carried out. The possibility of building gas- processing and gas chemical complexes based on this field is being negotiated. A new field — in order to develop gas supply to the Khabarovsk Territory Abakanskoye field — was discovered in 2010 . and the , as well as to arrange gas supply In the Irkutsk region, Chikanskoye field was brought into to the Primorsky Territory. The GTS first startup complex pilot production in 2008, and issues related to gas transport with the capacity of 1 billion cubic meters per year was facilities are currently negotiated, which includes transport commissioned in September of 2011. Gas supplies to facilities necessary for gas supply of the towns of Sayanks, Vladivostok consumers have been launched. Angarsk and Irkutsk. In 2007, first phase of the gas pipeline Yakutiya gas production center is now being developed, supplying gas from Bratskoye field to Bratsk consumers which will be composed of Chayandinskoye oil and gas was completed. In 2011, Gazprom company purchased the condensate field, Yakutia–Khabarovsk–Vladivostok gas assets of RUSIA Petroleum company. transmission pipeline and a gas treatment plant with helium Works on the establishment of the Kamchatka territory extraction and helium storage system. The high priority project gas supply system have been started, Sobolevo — within the Yakutia center is Chayandinskoye field with the Petropavlovsk-Kamchatsky gas transmission pipeline has explored reserves of more than 1.2 trillion cubic meters of gas and 68.4 million tons of oil and condensate. In accordance with the Russian Federation Government directive, Gazprom has obtained a license for the Chayandinskoye field that previously belonged to the Federal Fund of Strategic Deposits. The further development of this gas production center is associated with the development of several fields adjacent to Chayanda — Srednebotuobinskoye, Tas- Yuryahskoye, Verkhne-Vilyuchanskoye, etc. It is planned to construct Yakutia-Khabarovsk-Vladivostok gas pipeline. The significant part of the pipeline will be integrated with ESPO pipeline system, the pipeline will also be linked to Sakhalin — Khabarovsk — Vladivostok GTS. Thus, the Yakutian gas will be supplied not only to south areas of the Far-Eastern federal district, but also for export (via pipeline, or in compressed or liquefied form, which will necessitate construction of the relevant plant near Vladivostok). Issues related to the construction of gas-processing facilities based on the Chayandinskoye field, and also to the construction of LNG production facilities in the Primorsky Territory are negotiated now. The establishment of Krasnoyarsk and Irkutsk gas production centers is being continued. Gazprom company is carrying out exploration activities on 23 blocks located in these regions. In the Krasnoyarsky Territory, the

14 № 5/40 2012 – gas processing plant and gas chemical complex in the RUSSIA Krasnoyarsk Territory, based on Sobinsko-Paiginskoye oil & gas condensate field. – gas processing plants and gas chemical complexes in the Irkutsk region, including based on the gas resources of Chikanskoye gas condensate field; bering – gas processing plants and gas chemical complexes in sea the Republic of Sakha (Yakutia), LNG plant and gas chemical complex based on the gas resources of Chayandinskoye oil and gas condensate field. Judging by the prospects of the Eastern Siberia and Far East social and economic development as well as Eastern kamchatka gas program’s potential, in 10–15 years gas will take a peninsula sustainable position in the regions’ fuel and energy balance and by the year of 2020, gas will account for 28–38% of total consumption of the boiler and furnace fuel in these Kshukskoye regions.

Nizhne-Kvakchikskoye By now, Gazprom company has signed Agreements of Sea of sobolevo Cooperation with eleven out of fourteen Eastern Siberian and Far Eastern regions and Gasification Agreements — okhotsk petropavlovsk-kamchatsky with nine of them. The implementation of the Eastern gas program will Pacific require not only new technologies but also highly skilled ocean specialists. Gazprom is planning to train a major part of them “locally”, in the regions of the Eastern Siberia and Far East. As is known, Gazprom company has a System for continuous been constructed, and gas supplies to the territory’s center corporate professional education. The system includes the have been launched. Currently, Gazprom Company is following: organization of training and advanced training constructing Kshukskoye and Nizhne-Kvakchikskoye fields for workers (294 professions) in the training subdivisions located on the western coast of Kamchatka peninsula. within the system; support in the training of young specialist having higher education; organization of advanced training Simultaneously with the construction works, preparation (540 workshops) and professional retraining (4 programs) for the exploration of West Kamchatka shelf is conducted, for leaders and specialists having higher education; because the existing onshore deposits do not allow for apprenticeships at Gazprom company’s production facilities stable gas supply of the territory in the long-term. for leaders, specialists and workers; pre-certification training Since the gas produced from the largest deposits of the for leaders, specialists and workers. East of Russia is characterized by high content of uranium, Within the framework of that system, a unique training propane, butane, other hydrocarbons and helium, the base has been opened in the Training center of Gazprom Program envisages the establishment of a number of large Transgaz Tomsk, with a number of full-scale simulators and gas-processing and gas chemical facilities focused on models of the gas transport system equipment. Some of export, which enterprises will provide the production volume the equipment items can be controlled remotely by means of at least 13.6 million tons a year by 2030. The demand of the supervisory control systems. The training base is for helium (especially in nuclear power engineering) is intended for the acquisition of skills related to using both forecasted to increase almost four times by 2030, due to existing technologies and future technologies proposed for the unique properties of helium. Under such circumstances, implementation. it is inadmissible to develop high helium content gas fields of Eastern Siberia and Yakutia merely for the sake of methane fuel gas. Such specifics requires a different approach to be applied in the development of resources of Yakutsk, Irkutsk and Krasnoyarsk centers, not the same as in the development of Western Siberia resources. It is necessary to apply the most up-to-date high technologies and to make full use of all of the components contained in the produced gas. It is not only about gas production, but also about establishment of a cluster of gas chemical enterprises in the East of Russia and about export of high value-added products. Within the framework of implementation of the Eastern Gas Program, Gazprom company is negotiating over some conceptual proposals related to the establishment of processing facilities in the Eastern Siberia and Far East. Currently, the company is considering the possibility to establish:

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