Download English version (PDF)

Скачать русскую версию (PDF)

Русская версия

This document describes the current situation with the natural gas transportation system in the Russian Federation with special focus on balancing issues as most significant in the medium-term perspective.

The first chapter substantiates the conclusion that the natural gas transportation system is presently in a satisfactory condition: the system supports planned shipments and remains functional at peak loads; the problem of ageing is successfully addressed by maintenance and repair of its individual components, as well as upgrades of its elements and intersections; the construction of new pipelines and pipeline junctions is commensurate with the current demand and production growth rate.

The second chapter is devoted to the future of the gas transportation system focusing on GTS development plans aimed at both the expansion of the domestic gas transportation system and export routes. Most of these plans are highly ambitious and could be implemented only through mobilization of significant resources. At the same time, the document emphasizes that the maintenance cost of the GTS in its present technical condition is rapidly increasing. Under the circumstances, every new project would call for innovative financing and management solutions.

The third chapter is devoted to risk assessment and presents a review of the factors changing the gas transportation business, as well as the analysis of potential impact of the change-driving factors on the GTS development. The key challenge described in the document is a move to a different conceptual approach replacing a physical target of «uninterrupted gas supply» by an economic target of developing a reliable gas market.

The fourth chapter discusses balancing issues as most significant ones in the mid-term perspective. Balancing is understood broadly as a number of objectives from maintaining a physical balance of gas injection into/off take from the main system in various time intervals to incentives for a rational behavior on the part of the system users and operators.

The fifth chapter outlines the existing procedures for obtaining access to the GTS. It provides a summary of the currently applicable legal base and suggests a conclusion that the problem of access to the system cannot be resolved by administrative methods alone without due consideration of economic aspects of gas the transportation and sales business. Nonetheless, the document concludes that access to the GTS could be realistically obtained if the interests of all parties are duly considered in the process.

The sixth chapter uses price forecasts to illustrate the current status of the industry. At first glance, gas pricing is controlled by the Russian Government, but in fact the prices are dictated by Gazprom, its strategies, costs, marketing, and production plans. The country has no constructive position on the natural gas demand flexibility. Hence, such flexibility has been simply ignored so far.