Gazprom opposed the export of LNG without reference to fields

Gazprom opposed the export of LNG without reference to fields

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Uncontrolled exports of Russian liquefied natural gas (LNG) will increase the risk of shortages on the domestic market. This was stated by the deputy head of the Gazprom department (MOEX: GAZP) Kirill Polous during a meeting of the State Duma Committee on Energy, which discussed amendments allowing the export of LNG without reference to fields.

During the meeting, Kirill Polous noted that the proposed bill will allow companies to use not only their own fields approved by the state for LNG export, but also any resource base. Thus, a number of subsoil users will have the opportunity to maximize gas exports in the form of LNG to the detriment of gas supplies to the Russian domestic market, says the deputy head of the Gazprom department.

“The draft law in the proposed version creates the preconditions for the uncontrolled export of LNG from Russia and increases the risk of reliable gas supply to Russian consumers. In the future, on the domestic market we risk seeing the same thing that we recently saw on the domestic market for petroleum products,” emphasized Mr. Polous (quoted from TASS).

The Ministry of Energy supported the bill. The head of the ministry, Nikolai Shulginov, said that the department does not see any threats to competition between LNG and pipeline gas after the adoption of the amendments. Following the meeting of the State Duma Committee on Energy, the draft amendments were approved for the first reading.

Draft amendments to the gas export law, which allows the export of LNG without reference to specific fields, was introduced to the State Duma in July. The document proposes to allow export to companies implementing LNG projects with a capacity of over 20 tons per hour, if more than 50% of the share in them belongs to persons with the right to directly or indirectly control more than half of the share in companies that have the right to export LNG. For now, only companies owning fields whose licenses indicate LNG production are allowed to export gas.

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