In late October, Norway's StatoilHydro was named Gazprom's second foreign partner, after French oil major Total had been given a 25% stake in the project in July. StatoilHydro has vast experience in the production of hydrocarbons from the Arctic shelf. The Norwegians won against ConocoPhillips, a U.S. oil and gas giant, which continued to hope till the last moment to join the project.
The Shtokman gas condensate deposit in the Russian Arctic zone 500 km off the coast, with gas reserves of 3.7 trillion cubic meters, is listed with the world's ten largest gas deposit, but it is also one of the most difficult to access. The partners will have the following stakes in the project: Gazprom 51%, Total 25%, and StatoilHydro 24%. Nothing is likely to change in this pattern and no new partners will appear, at least in the foreseeable future. Gazprom said formerly that it intended to keep a controlling stake in the operation of the project, and will fully own the license for Shtokman.
Shtokman Development Company, to act as the operator of the project, will be set up by the end of this year and carry out all the design and exploration work by mid-2009. After that, an investment decision will be made on the implementation of the project by Shtokman Development (the project is now assessed at $15-$20 billion).
According to tentative plans, the pipeline part of the project will be commissioned in 2013: about 11 billion cubic meters of gas from Shtokman will go via Russia into the Nord Stream gas pipeline to be laid on the Baltic seabed and connect Russia and Germany. In 2014, LNG production (7.5 million metric tons a year) will be started at a plant to be built by the Shtokman partners.
Major foreign oil and gas companies began planning gas production on the Shtokman field in the early 1990s and even established consortiums for it. However, they failed to obtain the right to develop. The last "chapter" in this long story began in 2004, when Gazprom announced the formation of yet another consortium to develop Shtokman. In 2005, a short list of the main candidates was compiled. It included Norway's Norsk Hydro and Statoil (which were separate companies until October 1, 2007), American Chevron and ConocoPhillips, and French Total. At that time, the project's set aim was LNG supplies to the United States.
However, these plans ended in failure. In September 2006, Gazprom announced that it would remain the 100% owner of Shtokman, while foreign companies could work as contractors. By that time, the Nord Stream project had taken shape, and it was decided to channel the bulk of Shtokman gas into it. Soon, however, it turned out that no one wanted to cooperate on such terms. As a result, the present compromise appeared. Some analysts think that the model tested in the Shtokman project may become the basis for major foreign companies' participation in other projects for developing Russian natural resources.
The choice of foreign partners for Shtokman shows that Russia still relies mostly on Europe in the gas sector. It showed a well-balanced approach to the issue choosing a French and a Norwegian company. On the one hand, France is the largest hydrocarbons importer among the EU countries, and on the other, one of the leaders of the European Union. Total's previous attempts to invest in Russia failed, so the Russian invitation to the French company to participate in such a project may help soften the EU legislation, which is currently being discussed and which will limit Gazprom's investment in the EU energy infrastructure.
Norway is not an EU member but is the world's third largest hydrocarbons exporter, therefore Norwegians have been regarded from the start as Gazprom's most promising partners for Shtokman. They successfully produce gas on their Snovit and Ormen Lange fields close to Shtokman and they have Europe's only LNG plant. They are active on the LNG market. Thus, in choosing partners for Shtokman, Gazprom took into account the interests of both importers and exporters, as well as political and technological factors.
The only loser in the project is the American company ConocoPhillips. It tried to attract Gazprom by the prospect of selling LNG from Shtokman to the United States. However, in the present market situation, it will not be a problem to distribute LNG received from Shtokman hydrocarbons without U.S. assistance, especially considering that StatoilHydro has gained a foothold on the LNG market in the United States.
The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.
