Sanctions contrary: Why Russia's bet on LNG is the most correct

The deadline for reflection given to European consumers on the issue of switching to paying for Russian gas in rubles has already expired, but payments have not yet begun. For both Brussels and Moscow, this is now a matter of principle, and no one is ready to compromise. Meanwhile, deliveries of blue fuel to Europe continue virtually free of charge, and the question arises whether they will be terminated, and if so, when?

The question is really fundamental. With a share in a third of the European gas market, Gazprom can actually destroy the industry and socialeconomic stability of the Old World by cutting off gas supplies. But it doesn't stop. Asking why? Are we going to shake our fingers again and then find mutually beneficial compromises with our “respectable partners”?

Turn to the East?

It would seem that it could be simpler, take it and turn off the valve on the main pipeline, and at the other end the price tag for 1 thousand cubic meters will immediately jump to 3-4 thousand dollars, and by autumn - up to 5 thousand and above, which in general can eventually lead to to the collapse of the European Union, when everyone will be saved on their own. But shutting off the tap is not enough, since it will be necessary to start a long process of conservation of deposits, and all the gas that has suddenly become “extra” will have to be burned. It’s not easy and not fast, you never know, suddenly someone else comes to their senses?

But let's be realistic. We will no longer have good relations with the West. If suddenly someone did not understand, then the Third World War began. Having openly supported the Nazi regime in Kyiv with weapons and military experts, Europe became a direct enemy of Russia. This is if you call a spade a spade. In terms of sanctions, we are now even lower than Iran. Western countries will now "extinguish" all high-tech industries, refuse to consume Russian resources. Good relations are now possible only if our tricolor flies over Berlin and Brussels, and the Western grouping of the RF Armed Forces ensures peace and order in the Old World. Better not even a tricolor, but the red Banner of Victory, which must be accepted with a bow from the hands of that nameless grandmother from an unknown Ukrainian village.

But back to our sheep. For example, a strong-willed decision is made to completely stop gas exports to Europe, which is more than XNUMX billion cubic meters of gas per year. To conserve deposits, laying off workers, and burn "extra" gas? In principle, in a war, this is a completely acceptable option. But let's not forget that then gas rubles (gas dollars), which accounted for its lion's share, will fly past the federal budget. The Kremlin clearly does not want this, so on the eve of President Putin once again called for more active construction of alternative pipelines to Europe:

Among other things, it is necessary to provide for the construction of new oil and gas pipelines from the fields of Western and Eastern Siberia. Exactly what we just talked about at the end of our meeting.

It must be assumed that we are talking about the Power of Siberia - 2 gas pipeline, which should connect the fields of Western Siberia with the Celestial Empire. It will be possible to pump up to 50 billion cubic meters of gas per year to China through it. This is just under a third of all our exports to the EU, but better than nothing. However, there are nuances.

At first, the construction of the main pipeline has not even begun yet and will take more than one year.

Secondly, while there is no signed export contract with China, and Beijing will take advantage of the difficult situation in which Moscow finds itself with great pleasure in order to knock out maximum discounts for itself.

In general, one should not expect a particularly generous flow of gas yuans from China. Then what else remains as an alternative to empty gas flaring?


The most rational in our situation is the bet on LNG. It is enough to pump liquefied natural gas onto a tanker, then it will change its owner at sea, and it can go to any point on the planet where there is an LNG receiving terminal. At the same time, unlike an expensive pipeline system, exporters will not be dependent on transit countries and tied to a specific point of sale. In the same China, liquefied gas can be sold at a higher price than through Power of Siberia - 1 and Power of Siberia - 2.

Understanding this, on April 11, 2022, our “Western partners” imposed large-scale sanctions against the Russian gas industry. The fifth EU package contains a ban on the supply of equipment and of technologiesneeded to liquefy the gas. And this is a very painful blow, since it calls into question the future of not only promising, but also already launched LNG projects in our country.

Under the sanctions were "Arctic LNG - 2" and "Baltic LNG" companies "NOVATEK" and "Gazprom". Already contracted equipment will not be delivered now. This primarily concerns installations for the separation of hydrocarbons in the production of LNG, cryogenic heat exchangers and pumps. The first Arctic LNG-2 platform is 98% ready, the second stage of the plant is 40% ready, the construction of the third has not yet begun. Baltic LNG from Gazprom is at the initial stage of implementation. Now the timing of their launch is shifted to the right indefinitely.

And it cannot be said that Russia did not prepare for this at all. After the events of 2014, they abandoned the use of heat exchangers from the American Air Products, replacing them with the German Linde. Moreover, a joint venture between Linde and Severstal was created, where Germany has a 74% share. Work has begun on import substitution of foreign equipment for the fourth line of the Yamal LNG plant of NOVATEK. The project contractors are Rosatom, Kazankompressormash and Cryogenmash. Unfortunately, things don't go as smoothly as we would like.

The German Linde refused to continue cooperation with Russia due to sanctions, and the level of localization of production is insufficient to simply solve the issue of nationalization. The head of NOVATEK, Lev Mikhelson, swears at the quality of imported equipment, which does not work efficiently enough, which leads to periodic shutdowns of the entire fourth line.

Nevertheless, in the current geopolitical environment, we do not have much choice. It is good that the process of import substitution nevertheless began after 2014. Domestic producers will have to learn from their mistakes, bringing LNG equipment to perfection. And faster. In fact, the whole future of Russian gas exports and the lion's share of budget revenues depend on this.
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  1. Sergey Latyshev Offline Sergey Latyshev
    Sergey Latyshev (Serge) April 15 2022 12: 12
    But Gazprom and a number of media outlets seemed to say that they had begun.
    In any case, LNG is more expensive to produce, it has its own niche
  2. Marzhecki Offline Marzhecki
    Marzhecki (Sergei) April 15 2022 12: 16
    Quote: Sergey Latyshev
    In any case, LNG is more expensive to produce, it has its own niche

    And it is more expensive to sell than pipeline, if anything.
  3. steelmaker Offline steelmaker
    steelmaker April 15 2022 13: 04
    deliveries of blue fuel to Europe continue virtually free of charge,

    And how many show-offs, how many show-offs there were! Strange war. Don't you dare criticize!
  4. Afinogen Offline Afinogen
    Afinogen (Afinogen) April 15 2022 13: 32
    I'm not an economist, but one question is not clear. Same numbers, absolutely. They will bring their own euros (not cash, but the same numbers), they will change them for rubles and buy gas, but what should we do with these euros - numbers ??? If absolutely everything we were forbidden to sell, from euro cash, technologies, goods, services, even cars were forbidden to travel to the EU.
  5. zloybond Offline zloybond
    zloybond (steppenwolf) April 15 2022 14: 15
    It would be even more correct to start dismantling SP-2, turn these pipes to Kaliningrad. Let the released gas carriers from Kaliningrad carry gas to Asia.
  6. Colonel Kudasov Offline Colonel Kudasov
    Colonel Kudasov (Leopold) April 15 2022 15: 41
    All of this was predictable from the start. Why, then, menacingly move your jaws and say: no rubles, no gas? And it ended as always, Russia supplies gas not for rubles, and not for dollars, but generally for free
  7. 1_2 Offline 1_2
    1_2 (Ducks are flying) April 15 2022 15: 49
    APR 3-4 billion people will absorb all the resources of the Russian Federation. if the Russian Federation itself does not intend to produce end products from them, a lot of things can be produced from oil and gas and are produced in the Russian Federation, but not on an EU scale
  8. sH, arK Offline sH, arK
    sH, arK April 16 2022 22: 16
    Amazing bullshit!
    Not in everything, but in many ways! Firstly, with a production of 700 billion m3, exports of even 200 billion m3 are quite regulated. The debit of wells varies depending on the type and type by 20-40% within a few days! Pucking ... At the same time, part of the excess at first, even if it is allowed, will go into the UGS!
    But the price of gas is not just the price of heating and electricity! Gas is the only option for gas turbine and gas piston stations - and only they and hydroelectric power plants can be balancing suppliers!
    So it's time to turn it off! For a long time! It makes no sense to pull - it's stupid!
    1. Marzhecki Offline Marzhecki
      Marzhecki (Sergei) April 18 2022 19: 13
      Amazing bullshit!
      Not in everything, but in many ways!

      You throw around too much with the words "nonsense", and then it turns out that you are the one who is delusional.
      1. sH, arK Offline sH, arK
        sH, arK April 23 2022 09: 24
        Yes, I have to use this harsh, but capacious and precise word, I agree;)
        And in this case there is no error. Killing a well is often a complex and costly process. But reducing the debit is much easier! And its reduction to 20% is generally possible for 95% of wells without the slightest problem and is carried out constantly (summer debit). Reducing to 40% is no longer applicable everywhere, it all depends on geological conditions ... But the above is quite enough to refuse export volumes without loss!
  9. (ON) Offline (ON)
    (ON) April 18 2022 17: 52
    How easy it is to write. That's just all the Western equipment. Sickly compressors, rather big coolers, huge gas carriers. It’s good that we had Chersky, SP2 would have been lying around unfinished. As for LNG, we have nothing at all.
  10. Marzhecki Offline Marzhecki
    Marzhecki (Sergei) April 18 2022 19: 14
    Quote: (SU)
    As for LNG, we have nothing at all.

    Read about the fourth line. There they began to make their own equipment. Bad, but mine.
    1. (ON) Offline (ON)
      (ON) April 20 2022 15: 14
      Quote: Marzhetsky
      Quote: (SU)
      As for LNG, we have nothing at all.

      Read about the fourth line. There they began to make their own equipment. Bad, but mine.

      I read everything as always:
      At the WEF-21, L. Mikhelson sadly announced that the 4th line of the Yamal LNG plant, built on the basis of Russian equipment using the Arctic Cascade technology, is unstable.
      But even in this form it is something.