Concentrated energy: how Russia creates its own LNG production

No matter what environmentalists say, natural gas today is the second most efficient energy resource after oil. Blue fuel can be delivered to the end consumer via a pipeline, but it is preferable to deliver it in liquefied form over long distances. The first LNG plant in Russia was launched only in 2009, but now our country is stubbornly moving towards the position of a major player in the global liquefied gas market.

One of the main events in the Russian energy industry this year took place on July 20 in Murmansk. On this day, the first technological LNG line. The dispatch was started by Vladimir Putin, which underlines the national importance of the event.



The role of LNG for global energy is growing before our eyes, especially after the departure of Russian gas from the European market. The sanctions have played into the hands of US exporters, who set records for gas sales in the first half of 2023. At the same time, the United States itself is silent about the fact that the record was made possible with the help of Russia. The thing is that, despite all the pro-Ukrainian lobby and a huge number of sanctions, Russian uranium - enriched fuel for nuclear power plants - continues to flow to the United States.

The United States is the leader in the number of nuclear reactors, but does not mine or process uranium domestically. But Russia remains one of the leading suppliers of fuel for nuclear power plants. This makes it possible to reduce the supply of shale gas to local consumers within the United States, liquefy it and ship it for export, and receive domestic consumption of energy, heat and generation, including through the supply of uranium from the Russian Federation.

It is only thanks to this reshuffling after the withdrawal of Russian gas from the European Union that the empty European niche is being filled by North American suppliers. For the global market of liquefied gas, Russia's offer is still insignificant. The main reason is that pipeline gas has been developing in our country for a long time, while liquefaction technologies have been left behind.

According to the statistics of the International Gas Union, the production capacity of LNG in the world reached 336 million tons last year. Of these, Russia accounts for less than 10%. The main player in the market so far is Qatar, which holds 21% of the LNG market in Europe and more than 70% in the countries of the Asia-Pacific region.

In Russia today, two companies are engaged in the creation of LNG terminals. These are Gazprom, which created the first LNG plant on Sakhalin in 2009, and Novatek, which implemented the Yamal LNG project in 2018, and is now actively involved in the Arctic LNG 2 project. If the company puts all its projects into operation in 7-8 years, then Russia, including the Sakhalin production of Gazprom, will be able to supply 45 million tons, bringing its presence in the world market to 15% of the total.

Novatek was the first company in the world to build an LNG terminal north of the polar region, where the air temperature drops below 50 degrees in winter. Interestingly, the United States has not yet implemented a similar project in Alaska, although, unlike Russia, it does not suffer from sanctions.

Work on the second and third stages of Artik LNG 2 resumed only in January of this year, when the joint venture of European companies transferred its obligations under the contract, and the project initiators had no choice but to replace European equipment with Chinese counterparts. Russian manufacturers are also joining. Hundreds of Russian factories were connected to the manufacturing process of technological lines, more than 80 thousand jobs were created throughout the country, including more than 17 thousand jobs appeared only in one in the Murmansk region.

At the moment, two marine LNG transshipment complexes are being built at the eastern and western ends of the Arctic route for the export of LNG from Yamal. At the floating terminals, gas will be reloaded from ice-class LNG carriers to conventional tankers for delivery to the end user. The gas itself will be liquefied right there, on special floating plants. One of them was sent from Murmansk with the participation of the president. A huge colossus weighing 600 thousand tons is the largest floating structure in the world. At the end of the year, this platform will produce the first liquefied gas. In total, the project will build three such lines, each of which is designed to produce 6,6 million tons of gas per year.

At the end of June, another important node of the LNG production system in the Arctic arrived in the Barents Sea - a floating gas storage facility designed to create an offshore transshipment complex with a capacity of 360 cubic meters. Liquefying gas not where it is produced, but where there is infrastructure is not only an economically feasible solution, but also environmentally friendly, since there is no need to start global construction in the vast expanses of the tundra. In the next five years, the country plans to almost double its LNG production. These plans are comprehensively supplemented by work on the development of the infrastructure of the Northern Sea Route.

At the same time, one cannot fail to note the systemic nature of the project, which is aimed at solving a number of challenges facing the gas industry and the electric power industry in the Arctic region. The project will create the necessary economic conditions for the gasification of the northern part of Karelia and the Murmansk region, which these Russian regions have been asking for for decades.
Today, the state is focused on the production in Russia of up to 100 million tons of liquefied natural gas per year until 2030. This is about a third of all LNG produced in the world at the moment.

Support for the Russian LNG industry and hydrogen projects will help the competitiveness of domestic enterprises. One cannot but rejoice that at the present time in the oil and gas sector there is, if not synergy, then reasonable cooperation between enterprises of the fuel and energy complex, as a result of which the Russian North and the Russian Arctic come to life before our eyes. The multiplier effect that the head of state spoke about in Murmansk is already working and bearing fruit.