Country Horizon: Russia - Zlata Sergeeva, Emre Hatipoglu - KAPSARC
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Country Horizon: Russia Zlata Sergeeva, Emre Hatipoglu November 2021 Doi: 10.30573/KS--2021-RT01 Country Horizon: Russia 1
About KAPSARC The King Abdullah Petroleum Studies and Research Center (KAPSARC) is a non-profit global institution dedicated to independent research into energy economics, policy, technology and the environment across all types of energy. KAPSARC’s mandate is to advance the understanding of energy challenges and opportunities facing the world today and tomorrow, through unbiased, independent, and high-caliber research for the benefit of society. KAPSARC is located in Riyadh, Saudi Arabia. This publication is also available in Arabic. Legal Notice © Copyright 2021 King Abdullah Petroleum Studies and Research Center (“KAPSARC”). This Document (and any information, data or materials contained therein) (the “Document”) shall not be used without the proper attribution to KAPSARC. The Document shall not be reproduced, in whole or in part, without the written permission of KAPSARC. KAPSARC makes no warranty, representation or undertaking whether expressed or implied, nor does it assume any legal liability, whether direct or indirect, or responsibility for the accuracy, completeness, or usefulness of any information that is contained in the Document. Nothing in the Document constitutes or shall be implied to constitute advice, recommendation or option. The views and opinions expressed in this publication are those of the authors and do not necessarily reflect the official views or position of KAPSARC. Country Horizon: Russia 2
Abstract
T
his report provides an up-to-date overview of Russian domestic and foreign policy issues related
to the oil and natural gas markets. We also discuss the potential role of hydrogen in Russia’s short-
term energy strategy. We present a succinct overview of the domestic determinants of Russian
energy policy and then describe Russia’s ongoing and planned energy infrastructure projects. In doing so,
we particularly focus on Russia’s recent efforts to bring its new hydrocarbon resources to global markets.
We also discuss recent developments related to Russia’s dialogue with its key energy partners. Our
commentary highlights the following three important points.
Russia’s domestic political economy places a premium on the stability of hydrocarbon revenues. Thus,
we expect Russia to support OPEC+ in the short and medium terms.
Russia’s government has set liquefied natural gas production targets. If Russia significantly ramps up
its capacities and meets these targets by 2035, Northeast Asia’s existing suppliers will face challenges
as a result. Current geopolitical risks in the South China Sea further highlight Russia’s potential to
replace existing hydrocarbon suppliers in the region.
Hydrogen presents a unique opportunity for Russia to repurpose and upgrade its energy infrastructure.
In doing so, Russia may maintain its leading role in global energy markets in a net-zero future.
Country Horizon: Russia 3
Major Highlights
Owing to its budgetary commitments, Russia Geopolitical risks in the South China Sea may
is likely to prefer a steady flow of hydrocarbon further consolidate Russia’s market position in
revenues over maximized revenues. Thus, we Northeast Asia.
expect Russia to support OPEC+ in the short
and medium terms. The recent $2 billion decision to convert the
Obskiy LNG plant to hydrogen production
Currently, earmarked investments in the Arctic, exemplifies Russia’s pivot to hydrogen
Ust Luga and Yamal liquefied natural gas (LNG) production.
projects exceed $88 billion. These investments
signal Russia’s commitment to LNG production Russia will face considerable challenges in
in the medium term. maintaining its level of crude production after
2025, owing to the declining quality of its
Russia’s official target of capturing 20% of the reserves.
global LNG market by 2035 solidifies these
intentions.
This increase in Russia’s LNG capacity will
challenge existing suppliers of Northeast Asian
markets.
Country Horizon: Russia 4
Introduction
G
lobal energy markets have been exhibiting Russian domestic politics place a premium on
more volatility since the onset of the stable hydrocarbon revenues. Thus, we expect
COVID-19 pandemic. This volatility has Russia to support OPEC+ in the short and
cemented Russia’s critical role in these markets. medium terms.
Saudi-Russian cooperation in OPEC+ was key
to concluding the historic production cut of 9.7 Russia significantly ramping up its capacity
million barrels per day in May and June 2020. This to achieve its liquefied natural gas (LNG)
production cut amounted to 10% of global crude production targets by 2035 will create
oil production at the time. Russia’s commitment to challenges for Northeast Asia’s existing
OPEC+ remains critical for oil suppliers to smooth suppliers. Geopolitical risks in the South China
out the global oil market. As energy markets Sea further highlight Russia’s capacity to
will continue to face challenges in the future, replace the current suppliers in the region.
understanding the drivers, enablers and challenges
of Russian energy policy is critical. These factors Hydrogen presents a unique opportunity for
are influenced, in turn, by numerous domestic and Russia to repurpose and upgrade its energy
foreign political and economic concerns. These infrastructure. In doing so, Russia can maintain
concerns shape the interests and capabilities of the its leading role in global energy markets in a net-
major actors in the Russian energy ecosystem. zero future.
This report provides an up-to-date overview of
Russian domestic and foreign policy issues relating
to the oil and natural gas markets. We also discuss
hydrogen’s potential role in Russia’s short-term
energy strategy. Our report first presents a succinct
overview of the domestic political determinants of
Russian energy policy. We then describe Russia’s
ongoing and planned energy infrastructure
projects. In doing so, we focus particularly on
Russia’s recent efforts to bring its new hydrocarbon
resources to global markets. We also discuss recent
developments related to Russia’s dialogue with its
key energy partners. Our report highlights three
important points:
Country Horizon: Russia 5
Domestic Finances and Energy Exports
R
ussia is a critical supplier to the global oil finances.
and gas markets. In 2020, Russia produced
10.7 million barrels of oil per day, making it Russia has some advantages relative to its OPEC+
the third-largest producer after the United States counterparts. Its average budget breakeven price
(U.S.) and Saudi Arabia. Russia was also the of oil is between $55 to $60 per barrel, and it has a
second-largest producer of natural gas after the floating exchange rate. Indeed, Russia’s credit default
U.S. in that year, with 638.5 billion cubic meters swap (CDS) rate, which indicates the risk premium
(bcm) of production (BP 2021). Revenues from oil charged by markets, has been steadily declining
and gas exports are critical for Russia’s national over the last five years. Specifically, it has fallen
budget and the maintenance of its social safety net. from 375 basis points (3.75%) in 2016 to below 100
The Russian government has further consolidated basis points in 2021, as Figure 1 shows. Although
its authority in the country’s hydrocarbon sector the COVID-19 pandemic created a momentary spike,
accordingly. Russia has managed its country risk well. Its CDS
rate has mostly hovered slightly below 100 basis
In 2020, the budget breakeven price of oil reached points since the pandemic-related spike.
$80 per barrel. In comparison, prices ranged from
$49 to $60 per barrel over the previous six years Russia does not need a high oil price to balance
(Finanz.ru. 2020). At the same time, the overall its budget, and lower oil prices can benefit Russia
Russian economy decelerated, exacerbated by for two reasons. First, it aims to prevent U.S. shale
the global COVID-19 pandemic. Thus, Russia’s oil entering the market. Second, it wants to avoid
dependence on oil revenues has increased. Despite incentivizing renewable energy projects that become
the surge in oil prices in 2021, this dependence is more competitive with traditional energy sources
expected to remain a prominent aspect of Russia’s when oil prices are high.
Figure 1. Russia’s economic risk profile (credit default swap rates, 2016 – 2021).
300
CDS value
200
100
0
2016 2017 2018 2019 2020 2021
Source: World Government Bonds (2021).
Country Horizon: Russia 6The Eastern Front: Siberian Reserves,
the South China Sea Conflict and the
Arctic Route
R
ussia has successfully incorporated its Russia is uniquely positioned to consolidate its
eastern oil and gas fields into global role as an energy supplier and transit state
markets. China is a natural buyer of for commodities in Northeast Asia. The Eastern
Siberian hydrocarbons. Russia has also tried to Siberia and Pacific Ocean (ESPO) pipelines can
bring these resources to the rest of the global carry 2.6 million barrels per day of Siberian oil to
market via the Kozmino (oil) and Vladivostok (LNG) the Northeast Asian markets (Dmitrieva and Griffin
terminals. Russia’s efforts may have unintended 2019). Similarly, the Power of Siberia gas pipeline,
consequences for global oil and gas markets owing which follows the ESPO route, has the capacity
to recent tensions in the South China Sea. If to carry 60 bcm of gas per year. More than half of
these tensions escalate into military hostilities, this gas is earmarked for China until 2025. These
Russia’s eastern reserves may replace oil and pipelines are operating at almost full capacity
gas from the Middle East. (Transneft 2019). However, a redirection of seaborne
exports to China, Japan and South Korea would
Yergin (2020) describes the South China Sea as allow Russia to displace these countries’ existing
“the most dangerous body of water in the world… oil suppliers relatively quickly. Alternative routes,
where the militaries of the United States and China such as the Kuyumba–Taishet route, currently
could most easily collide.” The tensions between operate well below capacity. Similarly, Gazprom
China and the U.S. in the South and East China can cover any shortage of LNG from the Gulf region
seas have been escalating rapidly over the last two by allocating more Power of Siberia gas to China,
decades. These tensions have previously led to Japan and South Korea.
militarized clashes between the two superpowers.
In 2018, two warships came within 40 meters of Russia has been investing heavily in its Arctic
a major collision. Various littoral states, including presence over the last decade in terms of both
Vietnam, the Philippines and Malaysia, have also trade and the military. Russian Presidential Decree
been contesting China’s projected power in this No. 645, set on October 26, 2020, directs Russia
region. In March 2021, China docked a flotilla of over to achieve 90 million tonnes per annum (mtpa) of
200 allegedly civilian ships to cement its control over Northern Sea Route loading by 2030. This loading
the southeastern wing of the disputed areas. The should increase to 130 mtpa by 2035. Accordingly,
Philippines strongly protested this move. Russia has made various infrastructure investments
across the Arctic route. The rerouting of energy
A conflict in this region would significantly disturb and commodity flows through the Arctic will offer
the flow of oil and trade commodities to and from Russia more leverage to dictate global trade flows
Northeast Asia. One-third of the global commodity between Europe and Northeast Asia. Recent
trade traverses the South China Sea. A disruption to satellite intelligence suggests that Russia has also
this route would increase the use of the Arctic route been increasing its military presence in the Arctic
between Asia and Europe. If such a conflict occurs, (Holroyd 2021).
Country Horizon: Russia 7Arctic and Global Gas Markets
Currently, Russian LNG production is centered in agreement that Gazprom and Shell signed in March
three areas, shown in Figure 2. 2021 (East Russia 2021).
First, the Baltics is an emerging center. It currently Third, the Arctic’s existing and planned Russian LNG
has only one existing middle-scale Cryogas-Vysotsk projects feature the capacity to create a baseload for
project (with the participation of Novatek). However, the Northern Sea Route. The existing Yamal LNG
Novatek and Gazprom have proposed several project, which was launched by Novatek in 2017, is
projects in the region. Although the Baltic center currently the largest LNG project in Russia. After a
is in a nascent stage, the region is close to the fourth train was brought to full capacity in June 2021,
European market. Thus, its production may grow to the total nominal capacity of the Yamal LNG plant
approximately 15 mtpa in the next decade. reached 17.4 mtpa (Dyatel 2021b). However, Yamal
LNG is likely to produce above its nominal capacity
Second, the Far East is exclusively covered by in 2022, as it did in 2019 (Interfax 2020a). Thus, an
Gazprom, which partners with Shell in Sakhalin II, output of 20 mtpa is possible (Interfax 2021a). Other
one of the two large-scale Russian LNG projects. projects in the region are also under construction
Gazprom launched this plant in 2009, and Shell has solely by Novatek. Thus, despite challenging
a 27.5% share in the project. The plant’s current weather conditions, the Arctic has the most LNG
capacity is 10.8 mtpa. A third 5 mtpa train may be projects in development and will remain the leading
added by 2027 under the new five-year cooperation LNG-producing region in Russia.
Figure 2. Main large- and medium-scale LNG projects in Russia by region.
45
40
Million tonnes per annum (mtpa)
35
30
25
20
15
10
5
0
Baltics Arctic Far East
Further potential developments under discussion Planned / under construction Existing
Source: KAPSARC, based on data from the Federal Customs Service of Russia (2021).
Country Horizon: Russia 8Arctic and Global Gas Markets
Yamal LNG supplies both Asian and European were sent to Europe, as Figure 3 shows. Yamal
markets. Asian markets receive Yamal LNG via LNG does not directly compete with the pipeline gas
the Northern Sea Route in summers and via the supplied to Europe by Gazprom. Yamal mostly ships
western route with transshipment at a European to markets where pipeline imports are also increasing
terminal in winters. However, Yamal’s exports are (e.g., France, Netherlands and Belgium) or where
predominantly directed to Europe. In 2020, only 1.8 no pipeline access exists (e.g., Portugal) (Mitrova,
mtpa of Yamal LNG (or 10% of Yamal’s output) was Grushevenko, and Malov 2018).
exported directly to Asia. The remaining 15.5 mtpa
Figure 3. Destinations of LNG from the Yamal LNG and Sakhalin II projects.
Main LNG exports from Russia in 2020
20.00
15.00
Million tonnes
10.00
5.00
-
East West East West
Yamal Sakhalin
China Taiwan Japan South Korea
Singapore France Belgium Spain
Netherlands United Kingdom Norway Portugal
Source: KAPSARC, based on data from the Federal Customs Service of Russia (2021).
Country Horizon: Russia 9Arctic and Global Gas Markets
The various medium- and large-scale LNG projects completed) and is expected to be launched in
throughout Russia will add to Russia’s existing 2023 to 2025 (Novatek 2021d, TASS 2021a;
production capacity of 30 mtpa. Thus, Russia’s Interfax 2021b). It is the largest of Russia’s
production capacity is expected to reach almost 65 existing and forthcoming LNG projects.
mtpa by 2026. The announced forthcoming additions
include the following: In addition to Arctic LNG 2, Novatek planned to
launch another project, Obskiy LNG, in 2022 to
Portovaya LNG in the Baltics is expected to 2023. However, the final investment decision on this
be launched by Gazprom in the second half of project was delayed in April 2020 “due to uncertain
2022 with a capacity of 1.5 mtpa. The project market conditions” (Davydov 2021). Soon after
will be used to supply gas to Kaliningrad Oblast, that, the decision to convert the project to ammonia
which is a Russian exclave with access to the production was announced (Dyatel 2021a). In June
Baltic Sea in Europe. 2021, Novatek signed an agreement with Sberbank
and Gazprombank to finance the construction of a
Ust-Luga complex is a Gazprom project in gas chemical plant on the Yamal Peninsula. Obskiy
the Baltics involving LNG and gas chemistry. LNG was simultaneously renamed the Obskiy
An engineering, procurement and construction Gas Chemical Complex (Obskiy GCC) (National
(EPC) contract with Linde and RHI was signed Association of Oil and Gas Services 2021). The
in September 2021 (Finam 2021). The project is complex is now expected to focus on clean fuels
expected to be launched in 2024 to 2025 with a such as ammonia, hydrogen, and methanol,
capacity of 13 mtpa (Sea News 2021; Savosin, which we explain in more detail below. Deputy
2021). Planned as a large complex for both LNG Chairman of the Management Board, Mark Gyetvay,
production and natural gas processing, this stated that this repurposing will not affect the
project has had a difficult history. Developed in company’s long-term goal of producing 57 to 70 mtpa
2005 under the name ‘Baltic LNG,’ it was put of LNG by 2030 (Davydov 2020).
on hold along with another ambitious Gazprom
LNG project, the offshore Shtokman LNG Owing to Yamal LNG’s success, the Russian
project. This postponement was due to the government decided to increase LNG production
decrease in LNG’s competitiveness after the further. Russia now aims to capture up to 20%
shale revolution in the U.S. In 2014, the idea of the global market by 2035. A series of actions
was again reviewed with Shell’s participation, towards this goal culminated in the Russian LNG
but Shell was ultimately asked to leave the Development Strategy, adopted in March 2021.
project. In March 2021, Gazprom changed the This strategy officially set the 20% target (Reuters
EPC contractor of the project and stated that 2021a). Many of the associated reforms focus on
the change would not delay the construction strengthening LNG producers.
schedule.
In 2020, the State Duma adopted changes to the
Arctic LNG 2, a Novatek project in the Arctic Federal Law on the export of natural gas. Before
region, has a projected capacity of 19.8 these changes, only companies that had received
mtpa. As of November 2021, the project is gas field development licenses before January 1,
52% complete (the first train is roughly 69% 2013, could supply LNG abroad (Shtykina 2020).
Country Horizon: Russia 10Arctic and Global Gas Markets
The lifting of this limitation in May 2020 has allowed decision of the Duesseldorf Higher Regional Court
Novatek’s new projects to move forward (Government in Germany. Specifically, in August 2021, the court
of Russia 2020b). For example, a subsidiary of ruled that the Nord Stream 2 gas pipeline is not
Novatek recently won an auction to explore and exempt from European Union (EU) rules. Thus,
use the Arctic and Neitinskoye fields. These fields the pipeline operator should be independent from
are close to the Yamal LNG plant. Their estimated Gazprom (Kaeckenhoff 2021), and only half of
reserves are 2.9 billion barrels of oil equivalent, the newly constructed pipeline can be filled with
including 413 bcm of gas and 28 million tonnes of the monopolist’s gas. To address this regulation,
liquid hydrocarbons (Interfax 2021c). Nevertheless, Russian policymakers are considering granting
developing the capacity to liquify gas remains an export permission to Rosneft, the largest Russian oil
issue for Russia. producer (Rassokhin 2021). However, this action will
be limited in scope and does not suggest that natural
Currently, Gazprom still retains the exclusive right gas exports via pipeline will be liberalized for other
to export Russian gas via pipelines. However, this producers.
monopoly may be slightly altered owing to a recent
Country Horizon: Russia 11Carbon Neutrality of Russian
Hydrocarbon Production
R
ussian hydrocarbon producers are growing Novatek also announced a carbon capture and
increasingly interested in low- and zero- storage (CCS) project in the Yamal Peninsula that
carbon solutions for their products. will allow it to produce carbon-neutral LNG and
Addressing carbon emissions not only increases blue hydrogen. In March 2021, Gazprom delivered
the premium on Russian hydrocarbon exports but the first carbon-neutral LNG cargo in the Atlantic
also provides a competitive edge to hard-to-abate basin. This carbon-neutral LNG, delivered to Shell
industries in Russia. Accordingly, Russia has been at the Dragon terminal in the United Kingdom,
taking various steps to demonstrate its commitment was sourced from Novatek’s Yamal LNG project
to reducing its carbon emissions. In October 2021, (Kommersant 2021a). Gazprom and Shell jointly
Russian President Vladimir Putin announced a goal offset the cargo’s carbon footprint using Verified
of reaching carbon neutrality by 2060. Carbon Standard and Climate, Community and
Biodiversity emission certificates (TASS 2021b).
A subsidiary of Novatek opened its first
carbon-neutral LNG fueling station in Rostok,
Germany, in December 2020. It offsets the
emissions from LNG that it sells through emission–
reduction projects (Novatek 2020).
Country Horizon: Russia 12Devaluation of the Ruble to Boost
Hydrocarbon Investments
As Figure 4 shows, the Russian ruble was to 2017. Figure 5 illustrates this effect. However,
significantly devalued after Russia’s annexation of the maintaining the same level of production
Crimean Peninsula and the subsequent international after 2025 will be a considerable challenge.
sanctions against Russia. This depreciation positively Hard-to-recover reserves are increasing, and their
affected the oil and gas industry, as the industry’s quality is decreasing. The largest active fields
operating expenses are mostly denominated in (i.e., Priobskoye, Samotlor and Vankorskoye) have
rubles, but its revenues are denominated in dollars. entered a phase of declining production (Petlevoy
The industry experienced a record cumulative growth 2019; Starinskaya 2018). Russia has not invested
rate of 6% from 2012 to 2016 (Mitrova, Grushevenko, in domestic technology and equipment for the
and Malov 2018). development of unconventional and offshore oil
reserves, compounding its long-term capacity
This growth, combined with tax waivers for new problems. Sanctions restricting access to foreign
fields adopted in 2013, strengthened the economics capital further exacerbate this challenge.
of over 10 greenfield oil projects launched from 2014
Figure 4. Exchange rate of U.S. dollars to rubles, 2012 – 2021.
Source: Statista (2021).
Country Horizon: Russia 13Devaluation of the Ruble to Boost Hydrocarbon Investments Figure 5. Conventional onshore projects launched from 2014 to 2017. Source: Mitrova, Grushevenko, and Malov (2018). Country Horizon: Russia 14
Russia and the European Gas Markets
Russia’s strategy for the Western markets still was welded together (Deutsche Welle 2021). The
focuses on remaining the central supplier, and it has route is over 1,200 kilometers long, as Figure 6
been relatively successful in doing so. Russia is the shows, and its construction cost 9.5 billion euros.
EU’s top gas supplier. In 2020, Russia supplied 48% Gazprom was expected to make its first delivery
of all extra-EU gas imports via pipeline and LNG to Germany via this pipeline in October 2021 and
(Market Observatory for Energy 2021). Pipeline gas supply approximately 5.6 bcm of natural gas by the
from Russia comprised 43% of Europe's pipeline gas end of 2021 (Interfax 2021d). However, the approval
imports in that year. Russia also supplied 20.2% (17 process got suspended, and, as of November 2021,
bcm) of Europe's LNG imports, ranking third after the Gazprom is still waiting for permission to commission
U.S. and Qatar. the infrastructure (Reuters 2021b). The company is
also assessing the possibility of using the pipeline to
The Nord Stream 2 pipeline aims to double Russia’s transport hydrogen (TASS 2021c).
direct export capacity to Germany to 110 bcm per
year. On September 6, 2021, the final piece of piping
Figure 6. Nord Stream, Nord Stream 2, and onshore connections.
Source: Elijah (2021).
Country Horizon: Russia 15Russia and the European Gas Markets Initially, the construction of the Nord Stream 2 2020 occurred for many reasons. A high level of pipeline was planned for the end of 2019. However, gas imports to Europe at the end of 2019 increased it was delayed by the U.S. sanctions, which forced storage levels. The late signing of the contract, a some European companies to exit the project (e.g., warm winter and shrinking demand in Europe and the Swiss owner of the pipelayer Allseas) (Lenta Asia also reduced the volume of gas. The Ukrainian 2021a). A deal between the U.S. and Germany transport system is the most expensive option and eventually enabled the construction to be completed. is loaded on a leftover basis, which further reduced The terms of the deal provide for the use of the the demand for this route. Russian experts expect pipeline in exchange for the continued transit of these challenges to grow in most scenarios given the Russian gas through Ukraine. On December 30, rapid changes in the European market (RIA Novosti 2019, Gazprom and Ukraine’s Naftogaz signed a 2021a). Ukrainian officials are also pushing for a new five-year transit contract. The deal provides for the long-term contract with financial guarantees (RIA pumping of at least 65 bcm of gas in 2020 and 40 Novosti 2021b). bcm annually in the next four years. In 2020, a record low 55.8 bcm of gas were pumped through Ukraine, meaning that less than 30% of Ukraine’s gas transport system was utilized. However, Gazprom fully paid for the booked transit capacity (RIA Novosti 2021a). The low numbers in Country Horizon: Russia 16
Impact of COVID-19
A
ccording to Russia’s Federal State Statistics Despite these declines, the expectations for
Service, Russia’s gross domestic product economic recovery are becoming more optimistic.
(GDP) declined by 3.1% in 2020 owing to the In July 2021, the Ministry of Economic Development
COVID-19 pandemic. Its nominal GDP amounted to sharply raised its forecast of GDP growth in 2021
$1,418 billion. The decrease in the global demand from 2.9% to 3.8%. This recovery will be the
for energy and, hence, for Russian hydrocarbons fastest economic growth rate in Russia since 2012.
played a central role in this decline. In 2020, total However, expected inflation also increased from
exports from Russia fell by 5.1% (Kommersant. 4.3% to 5%. Official forecasts from the Ministry of
2021c). Russian oil production decreased from 4.1 Economic Development for GDP growth in 2022,
billion barrels in 2019 to 3.8 billion barrels in 2020, 2023 and 2024 are 3.2%, 3% and 3%, respectively
an 8.6% reduction. Russia’s 2020 oil production was (Tkachev and Minaichev 2021). The Ministry of
the lowest in a decade, causing export revenues to Finance recently disagreed with these forecasts,
fall 40% to $72.4 billion from $122.8 billion in 2019 stating that the economic growth rate will exceed
(Morvesti 2021). Unemployment also grew sharply 4% in 2021. However, it also expects inflation to be
from 1% in March 2020 to 4.7% in September 2020 considerably greater than 5% (Grinkevich, Boyko, and
owing to the pandemic (Federal State Statistics Tserekh 2021).
Service 2021). Russian energy companies’ bottom
lines suffered considerably as a result. For instance,
Gazprom's gross profit fell by 25% in 2020 (TASS
2021i). According to Russian accounting standards,
Gazprom recorded a loss of $9.4 billion in 2020, its
first loss since 1998 (Kommersant 2021b).
Country Horizon: Russia 17Hydrogen
Russian stakeholders have grown very interested interesting time, a time of an energy revolution, and
in the development of the hydrogen economy. it is important to immediately take a stable position
Adopted in June 2020, the Energy Strategy of the and stake it out” (Energy Policy 2021). Deputy Prime
Russian Federation up to 2035 includes plans for Minister Alexander Novak later provided government
the production and consumption of hydrogen. It sets estimates of the size of the hydrogen market. Russia
a goal for Russia to become a leading hydrogen predicts that this market will amount to 39 to 167
exporter. Specifically, it sets two targets for hydrogen million tonnes by the middle of the century (TASS
exports of 0.2 mtpa by 2024 and 2 mtpa by 2035 2021e; Oil and Capital 2021).
(Government of Russia 2020a). In October 2020,
the Russian government approved the Ministry of The largest Russian energy companies have made
Energy’s Hydrogen Roadmap up to 2024, which announcements regarding their growing ambitions
provides fiscal objectives to achieve these targets in the hydrogen market. Gazprom plans to further
(Ministry of Energy of the Russian Federation 2020). develop the ‘turquoise’ hydrogen technology that it
Accordingly, the Ministry of Energy’s Hydrogen already possesses. It is negotiating with European
Strategy highlights engagement with global partners, partners on the implementation of pilot hydrogen
especially Germany, France, Japan and South Korea projects in Europe, especially under the EU’s
(Prime 2021). grant mechanisms (Interfax 2020b). Currently, the
company’s facilities produce over 350,000 tonnes
Russia’s Ministry of Energy is preparing the Concept of hydrogen per year (Gazprom 2021). Gazprom
of Hydrogen Energy Development until 2024 based is also exploring the prospects for applying and
on the Hydrogen Roadmap. In August 2021, the exporting methane-hydrogen mixtures using existing
government published a draft version of this concept infrastructure.
(TASS 2021d). It envisages the creation of specialized
hydrogen clusters, the use of hydrogen energy Novatek is actively partnering with other companies
carriers domestically and the establishment of large on the development and export of hydrogen. Its
export-oriented production facilities. In April, it was partners include TotalEnergies (Novatek 2021c),
leaked to the media that Russia plans to earn $23.6 Uniper (TASS 2021f) and Nuovo Pignone (TASS
to $100.2 billion a year by exporting environmentally 2021g). It has also partnered with the Russian
friendly types of hydrogen. Russia aims to supply the steelmaking companies Severstal (Novatek 2021b)
world market with 7.9 mtpa to 33.4 mtpa of hydrogen and NLMK (Novatek 2021a). It also recently
by 2050 (Interfax 2021e). repurposed its proposed Obskiy LNG project for the
production of hydrogen, methanol and ammonia. It
Simultaneously, several high officials claimed that will produce ammonia both for the chemical industry
Russia is preparing to occupy a 20% share of the and as a means of transporting hydrogen. The
hydrogen market. This share is close to its shares project envisages utilizing CCS technology to offer
of the oil and gas markets. In an interview, Minister customers blue hydrogen and ammonia. The total
of Energy Nikolay Shulginov said, “We are facing ammonia production capacity at Obskiy LNG may
an ambitious task – to occupy 20% of the market, reach 2.2 mtpa. An initial launch is planned for the
and it is not negotiable.” He also added that “Russia end of 2026, with estimated investments of $2.2 to
plans to be present in the markets of all types of $2.4 billion (Alifirova 2021). Novatek is also in talks to
hydrogen in order to fit into all niches. We live in an sell a stake in the Obskiy GCC to Mitsui, which will
Country Horizon: Russia 18Hydrogen
also be a buyer of ammonia. The final investment In May 2021, Russia’s Central Scientific Research
decisions will be made at the beginning of 2022. Automobile and Automotive Engine Institute began
manufacturing a new hydrogen passenger car model,
Russian policymakers seem interested in using Aurus Senat (Figure 7). Russia’s Ministry of Industry
hydrogen in the transportation sector. A large and Trade recently announced that the first hydrogen
hydrogen project is planned in the Sakhalin region in buses will appear on city streets by 2024 (Lenta
the Russian Far East. According to the agreement 2021b). Two large Russian automotive manufacturers,
with the regional government, Transmashholding KAMAZ and GAZ, showcased the first prototypes
(TMH) will produce and supply seven hydrogen- in Moscow at the Comtrans international exhibition
based passenger trains by 2024 (Burmistrova 2021). in September 2021. KAMAZ’s bus is designed for
TMH is one of the largest Russian manufacturers 80 passengers and has a maximum speed of 80
of rolling stock for rail transport. The State Atomic kilometers per hour and a driving distance of 250
Energy Corporation Rosatom will provide hydrogen kilometers. Its cost is currently ten times that of a
for the project, and Russian Railways will operate conventional bus (Alekseeva and Kolesnikov 2021).
the trains. The costs of two-car and three-car trains
are estimated to be $5.6 million and $6.7 million,
respectively. TMH is expected to supply five two-car
and two three-car hydrogen trains.
Figure 7. Russia’s Aurus Senat, which uses hydrogen.
Source: Yarygin (2021).
Country Horizon: Russia 19Hydrogen Figure 8. Russian hydrogen buses by KAMAZ (left) and GAZ (right). Source: Alekseeva and Kolesnikov (2021). Country Horizon: Russia 20
Carbon Emissions, the Paris Agreement
and Russian Energy Policy
Russia ratified the Paris Agreement in September 93% of Russians acknowledge that climate change is
2019. In its 2020 submission of its nationally happening. However, 40% of the survey respondents
determined contribution, Russia confirmed its target believe that climate change is exaggerated. Moreover,
of reducing its emissions by 30% compared to 1990 62% to 76% of respondents are unwilling to pay more
levels (Antonich 2020). However, Russia’s current for goods and services to support the introduction
greenhouse gas (GHG) emissions levels are already of renewable energy or energy efficiency measures
well below 1990 levels. According to the United (TASS 2020). Thus, public opinion cannot serve
Nations Framework Convention on Climate Change, as a catalyst for more active measures in Russia.
Russia’s total GHG missions in 2019 were just 67.1% However, international developments are forcing
of 1990 levels. With land use, land-use change and Russia to devise strategies to reduce its emissions.
forestry, they were 51.34% of 1990 levels (UNFCCC In October 2021, Vladimir Putin announced that
n.d.). The reduction was largely due to the economic the country will aspire to reach carbon neutrality by
and industrial decline after the collapse of the USSR. 2060. This target will be incorporated in one of the
two scenarios developed by the Ministry of Economic
Russians are not generally supportive of climate Development (President of Russia 2021a).
policies. A recent nationwide survey showed that
Figure 9. Russia’s carbon dioxide emissions and all GHG emissions, 1990 – 2018.
3,500
Million tonnes of carbon dioxide equivalent
3,000
2,500
2,000
1,500
1,000
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
CO2 all GHG
Source: Climate Watch (2021).
Country Horizon: Russia 21Carbon Emissions, the Paris Agreement and Russian Energy Policy
The EU Carbon Border Adjustment Mechanism 2023. Smaller emitters that generate between 50,000
(CBAM) is one of the main concerns for Russian and 150,000 tonnes of carbon dioxide equivalent
exporting companies. According to some sources, per year will come under regulation on January
the CBAM may result in huge losses for the most 1, 2024. They will need to report their emissions
energy-dense industries by 2030. Estimates of these beginning January 1, 2025 (Government of Russia
losses range from 6 billion to 50.6 billion euros. 2021). The Sakhalin Oblast will be the pilot region
Nevertheless, Russian LNG has a small carbon for Russia’s emissions trading system (EPR Russia
footprint relative to its major competitors, as Figure 2021). Russia’s Ministry of Economic Development
10 shows. Hence, the imposition of the CBAM and expects four to six regions to join this carbon pricing
similar trading schemes may offer Russian LNG a experiment in the next 1.5 to two years (EIPC 2021).
temporary advantage in global markets.
Russia is also engaging in climate policy for financial
To reduce the possible consequences of the CBAM, reasons. In a speech at the Saint Petersburg
the Russian government introduced an emissions International Economic Forum, President Putin
trading system. Federal Law No. 296-FZ “On Limiting underscored the revenue of the climate industry. In
Greenhouse Gas Emissions” was adopted in July the Russian market, this revenue may soon exceed
2021 (CMS Law Now 2021). This law will become $50 billion per year. He said that this market “[is]
effective on December 30, 2021 (Government of a good, profitable direction for investment by both
Russia 2021). Until January 1, 2024, the regulation domestic and foreign companies” (TASS 2021h). This
will cover only emitters of more than 150,000 remark accompanied President Putin’s first public
tonnes of carbon dioxide equivalent per year. Such acknowledgement that climate change is derived
companies will need to begin reporting on January 1, from human activities (President of Russia 2021b).
Figure 10. Carbon footprints of selected LNG projects.
0.6
0.5
tCO2 per 1 t LNG
0.4
0.3
0.2
0.1
0
Qatar LNG
Atlantic LNG
Gorgon LNG
Gladstone LNG
Nigeria LNG
Woodside LNG
Oman LNG
Pacific LNG
Sabine LNG
Yamal LNG
Snohvit LNG
BC GHG
Intensity benchmark
LNG Canada
Polar LNG (natural gas)
Polar LNG
(floating NPP)
Darwin LNG
Rasgas LNG
Source: Klimentiev and Bogdanov (2019).
Country Horizon: Russia 22Concluding Remarks
Recent changes in both government discourse and Europe. Its LNG products, with low carbon footprints,
policy suggest that Russia wants to take a more are expected to make further impacts on global
active part in shaping the global transition to a low- markets, especially as the Arctic Sea route becomes
carbon future. Toward that end, legacy hydrocarbon increasingly usable.
infrastructure and domestic economic concerns are
emerging as immediate challenges. Russia will aim to Global geopolitical risks also currently favor Russia’s
transform these challenges into opportunities from a hydrocarbon exports. Tensions between China, the
net-zero future perspective. If it is successful, Russia U.S. and the other littoral states have heightened
will extend its leadership in global energy markets in the South China Sea. The region has therefore
over the longer term. become another geopolitical hotspot for the energy
trade. An escalation of these hostilities may disrupt
Russia remains a key player in determining the the supplies of hydrocarbons from the Middle East
current state of the global oil and gas markets. Russia and Africa to China, South Korea and Japan. This
currently prefers a steady flow of revenues over profit heightened risk places further emphasis on Russian
maximization to maintain a stable domestic political terminals in the Pacific Ocean. It also benefits
and economic environment. Higher oil prices will Russian exports that would otherwise traverse the
also entice more shale oil to enter the market and Arctic to reach North Asian markets. Russia is also
accelerate some consumers’ shift to renewables. situated to benefit considerably from the recovery
Both of these factors further strengthen Russia’s of global demand for oil and gas following the
preference for lower oil prices. We therefore expect COVID-19 pandemic.
Russia to continue supporting OPEC+ in keeping oil
prices stable and global markets well supplied in the Finally, hydrogen may be adopted in global energy
short and medium terms. chains in the future, including in long-haul transport
and hard-to-abate sectors. If so, Russia’s existing
Large-scale investments in natural gas, along with pipeline infrastructure and expertise in transporting
the limited liberalization of this market, has started hydrocarbons will offer advantages in exporting
bearing positive results for Russia in both Europe and hydrogen. Developments in CCS technology may
Asia. The imminent completion of the Nord Stream allow Russia to further strengthen its position as an
2 project has strengthened Russia’s position in exporter of blue and turquoise hydrogen.
Country Horizon: Russia 23References
Alekseeva, Nadezhda, and Roman Kolesnikov. Climate Watch. 2021. “Historical GHG
2021. “‘It Will Cost The Same As 10 Conventional Emissions.” Accessed October 31, 2021.
Ones’: How KAMAZ Presented the Hydrogen https://www.climatewatchdata.org/ghg-
Bus.” Business Gazette, September 7. Accessed emissions?calculation=ABSOLUTE_VALUE&end_
October 31, 2021. https://m.business-gazeta.ru/ year=2018&gases=co2®ions=RUS§ors=to
article/521278. tal-excluding-lucf&start_year=1990.
Alifirova, E. 2021. “Buyer-investor. Novatek Is CMS Law Now. 2021. “Russia Publishes Law on
in Talks with Mitsui on Participation in the Obsk Limitation of Greenhouse Gas Emissions.” July
GCC Project.” Neftegaz.RU, June 24. Accessed 13. Accessed October 31, 2021. https://www.cms-
October 31, 2021. https://neftegaz.ru/news/ lawnow.com/ealerts/2021/07/russia-publishes-law-
Gazohimija/686029-pokupatel-investor-novatek- on-limitation-of-greenhouse-gas-emissions.
vedet-peregovory-s-mitsui-ob-uchastii-v-proekte-
obskiy-gkhk/.
Davydov, Denis. 2020. “NOVATEK Postponed
an Important LNG Project.” Technoblog, June 2.
Antonich, Beate. 2020. “Russian Federation’s Accessed October 31, 2021. https://teknoblog.
NDC Reiterates 30 Percent by 2030 Emission ru/2020/06/02/105804.
Reduction Goal.” SDG Knowledge Hub, December
2. Accessed October 31, 2021. https://sdg.iisd.org/
Deutsche Welle. 2021. “Nord Stream 2: Last
news/russian-federations-ndc-reiterates-30-percent-
Piece of Gas Pipeline is in Place.” September 6.
by-2030-emission-reduction-goal/.
Accessed October 31, 2021. https://www.dw.com/
en/nord-stream-2-last-piece-of-gas-pipeline-is-in-
BP. 2021. Statistical Review of World Energy. place/a-59102040.
London: BP. Accessed October 31, 2021. https://
www.bp.com/content/dam/bp/business-sites/en/
Dmitrieva, Anastasia, and Rosemary Griffin. 2019.
global/corporate/pdfs/energy-economics/statistical-
“Russia Targets Asia with Expanded ESPO Pipeline,
review/bp-stats-review-2021-full-report.pdf.
Competes with Saudi Arabia.” S&P Global Platts,
November 19. Accessed October 31, 2021. https://
Burmistrova, Svetlana. 2021. “Bokarev and www.spglobal.com/platts/ru/market-insights/latest-
Makhmudov's Company Will Build Hydrogen news/oil/112719-russia-targets-asia-with-expanded-
Trains for ₽3 Billion.” RBC, April 23. Accessed espo-pipeline-competes-with-saudi-arabia.
October 31, 2021. https://www.rbc.ru/
business/23/04/2021/60829beb9a794702b89c0404.
Dyatel, Tatiana. 2021a. “‘Arctic Cascade’ Sent
for Revision. Novatek to Change Liquefaction
Center for Environmental Industrial Policy (EIPC). Technology at Obskiy LNG.” Kommersant, March
2021. “Mechanisms of State Carbon Regulation: 15. Accessed October 31, 2021. https://www.
What Are the Possible Consequences for the kommersant.ru/doc/4729386.
Economy.” CENEF-XXI Webinar, July 26. Accessed
October 31, 2021. https://youtu.be/XAI7GawS8OA.
Country Horizon: Russia 24References
———. 2021b. “NOVATEK Brought the Fourth Federal State Statistics Service. 2021. “Employment
Line of the Project to Full Capacity.” Kommersant, and Unemployment in the Russian Federation in
May 31. Accessed October 31, 2021. https://www. October 2020.” Accessed October 31, 2021. https://
kommersant.ru/doc/4837540. rosstat.gov.ru/storage/mediabank/wFtwOnek/
zanyatost-i-bezrabotitsa.pdf.
East Russia. 2021. “Sakhalin-2 Can Be Expanded
Through Cooperation Between Gazprom and Shell.” Finanz.ru. 2020. “The Dependence of the Russian
November 12. Accessed October 31, 2021. https:// Budget on Oil Prices Jumped to a 6-year High.”
www.eastrussia.ru/news/sakhalin-2-mogut-rasshirit- 2020. Finanz.ru, November 6. Accessed October 31,
za-schet-sotrudnichestva-gazproma-i-shell/. 2021. https://www.finanz.ru/novosti/aktsii/zavisimost-
byudzheta-rf-ot-cen-na-neft-podskochila-do-6-
letnego-maksimuma-1029775207.
Elijah, Diane. 2021. “Topic Page: Nord Stream
2.” Independent Commodity Intelligence
Services. September 13. Accessed October Finam. 2021. “The JV of Gazprom and
31, 2021. https://www.icis.com/explore/ RusGazDobycha Signed a Contract with Linde and
resources/news/2020/12/16/10463483/ RHI for the Construction of an LNG Plant in the
topic-page-nord-stream-2. Ust-Luga Region.” September 9. Accessed October
31, 2021. https://www.finam.ru/analysis/newsitem/
sp-gazproma-i-rusgazdobychi-zaklyuchilo-kontrakt-
Energy Policy. 2021. “There is No Need to Rush
s-linde-i-rhi-na-stroitelstvo-spg-zavoda-v-raiyone-
to Part with Hydrocarbons, it is Necessary to
ust-lugi-20210909-17291/.
Develop Renewable Energy Sources along with
Traditional Types of Energy.” Interview with Nikolay
Shulginov, Minister of Energy of Russia. Energy Gazprom. 2021. “Gazprom Reviews Hydrogen
Policy, May 14. Accessed October 31, 2021. https:// Energy Development Areas.” Gazprom, March 18.
en.energypolicy.ru/there-is-no-need-to-rush-to- Accessed October 31, 2021. https://www.gazprom.
part-with-hydrocarbons-it-is-necessary-to-develop- com/press/news/2021/march/article525372/.
renewable-energy-sources-along-with-traditional-
types-of-energy/08/16/.
Government of Russia. 2020a. Energy Strategy
of the Russian Federation up to 2035. Moscow:
EPR Russia. 2021. “Sakhalin Will Become a Pilot Government of Russia. Accessed October 31,
Site for the Implementation of Carbon Trading.” 2021. http://static.government.ru/media/files/
April 2. Accessed October 31, 2021. https://www. w4sigFOiDjGVDYT4IgsApssm6mZRb7wx.pdf.
eprussia.ru/news/base/2021/7345229.htm.
———. 2020b. “Federal Law No. 137-FZ On
Federal Customs Service of Russia. 2021. “Data Amendments to Article 3 of the Federal Law On Gas
Analysis.” Accessed October 31, 2021. http://stat. Export.” Garant, April 4. Accessed October 31, 2021.
customs.gov.ru/analysis. http://www.garant.ru/hotlaw/federal/1363088/.
Country Horizon: Russia 25References
———. 2021. “Federal Law No. 296-FZ On Limiting ———. 2021c. “NOVATEK Bought the Arctic and
Greenhouse Gas Emissions.” Moscow: Official Neitinskoye Fields in Yamal Peninsula for 13.2
Internet Portal on Legislation. Accessed October Billion Rubles.” September 8. Accessed October 31,
31, 2021. http://ips.pravo.gov.ru:8080/default. 2021. https://www.interfax.ru/business/789164.
aspx?pn=0001202107020031.
———. 2021d. “5.6 bcm Can be Supplied via Nord
Grinkevich, Dmitry, Anastasia Boyko, and Julia Stream 2 in 2021.” August 19. Accessed October 31,
Tserekh. 2021. “The Ministry of Finance Did Not 2021. https://www.interfax.ru/business/785277.
Agree with the Forecast of the Ministry of Economic
Development.” Vedomosti, August 4. Accessed ———. 2021e. “In Russia, the Profit from the Export
October 31, 2021. https://www.vedomosti.ru/ of Hydrogen was Estimated at $100 Billion Per
economics/articles/2021/08/03/880709-minfine- Year.” April 15. Accessed August 4, 2021. https://
soglasilis-minekonomrazvitiya. iz.ru/1151819/2021-04-15/v-rossii-pribyl-ot-eksporta-
vodoroda-otcenili-v-100-mlrd-v-god.
Holroyd, Matthew. 2021. “Russian Military Presence
Expanding in the Arctic Region, Satellite Images Kaeckenhoff, Tom. 2021. “German Court Says
Show.” Euronews, April 7. Accessed October 31, EU Rules Apply to Nord Stream 2 Pipeline.”
2021. https://www.euronews.com/2021/04/07/ Reuters, August 25. Accessed October 31, 2021.
russian-military-presence-expanding-in-the-arctic- https://www.reuters.com/business/energy/german-
region-satellite-images-show. court-dismisses-challenge-nord-stream-2-pipeline-
consortium-2021-08-25/.
Interfax. 2020a. “Yamal LNG Produced 11% More
Gas in 2019.” February 26. Accessed October 31, Klimentiev, Aleksandr, and Yegor Bogdanov. 2019.
2021. https://www.interfax.ru/business/696757. “BC EAO Data.” In Russian Small- and Middle-
scale LNG Projects. Regional Series: The Arctic.
———. 2020b. “Gazprom Says They See a Niche Volume 2. Edited by Aleksandr Klimentiev, Tatiana
for Themselves in the European Hydrogen Strategy.” A. Mitrova, and S.A. Kapitonov, 80. Moscow:
July 14. Accessed October 31, 2021. https://www. SKOLKOVO Energy Centre. https://energy.skolkovo.
interfax.ru/business/717419. ru/downloads/documents/SEneC/Research/
SKOLKOVO_EneC_RU_Arc_Vol2.pdf.
———. 2021a. “The Fourth Train of Yamal LNG
Officially Launched.” June 3. Accessed October 31, Kommersant 2021a. “Gazprom Delivers Green LNG
2021. https://www.interfax.ru/russia/770415. to Europe for the First Time.” March 8. Accessed
October 31, 2021. https://www.kommersant.ru/
———. 2021b. “NOVATEK Considers Possible doc/4721067.
Launching of the 3rd Stage of ‘Arctic LNG 2’ a
Year Earlier.” May 17. Accessed October 31, 2021. ———. 2021b. “Gazprom Incurs a Loss Under RAS
https://www.interfax.ru/business/766305. for the First Time Since 1998.” March 24. Accessed
October 31, 2021. https://www.kommersant.ru/
doc/4742500.
Country Horizon: Russia 26References
———. 2021c. “Rosstat: GDP of Russia in 2020 National Association of Oil and Gas Services. 2021.
Decreased by 3.1%.” February 1. Accessed October “NOVATEK Renamed “Obskiy LNG” to ‘Obskiy Gas
31, 2021. https://www.kommersant.ru/doc/4671959. Chemical Complex.’” June 11. Accessed October
31, 2021. https://nangs.org/news/downstream/
novatek-pereimenoval-obskiy-spg-v-obskiy-ghk.
Lenta. 2021a. “‘Nord Stream 2’ 99 Percent
Complete.” July 28. Accessed October 31, 2021.
https://lenta.ru/news/2021/07/28/almost/. Novatek. 2020. “NOVATEK Launched First Carbon
Neutral LNG Fueling Station in Europe.” Novatek
Press Center, December 1. Accessed October 31,
———. 2021b. “Buses on a New Type of Fuel Will
2021. https://www.novatek.ru/en/press/releases/
Appear in Russia.” April 22. Accessed October 31,
index.php?id_4=4160.
2021. https://lenta.ru/news/2021/04/22/new/.
———. 2021a. “NOVATEK and NLMK Signed MOU
Market Observatory for Energy. 2021. Quarterly on Decarbonization.” Novatek Press Center, January
Report on European Gas Markets. Brussels: 12. Accessed October 31, 2021. https://www.
European Commission. Accessed October 31, novatek.ru/en/press/releases/index.php?id_4=4213.
2021. https://ec.europa.eu/energy/sites/default/
files/quarterly_report_on_european_gas_markets_
———. 2021b. “NOVATEK and Severstal Sign
q4_2020_final.pdf.
Memorandum on Hydrogen Energy and Reducing
Greenhouse Gas Emissions.” Novatek Events, June
Ministry of Energy of the Russian Federation. 4. Accessed October 31, 2021. https://www.novatek.
2020. “The Government of The Russian Federation ru/en/investors/events/?id_4=4506.
Approved an Action Plan for the Development of
Hydrogen Energy.” Accessed October 31, 2021. ———. 2021c. NOVATEK and TotalEnergies
https://minenergo.gov.ru/node/19194. Sign MOU on Decarbonization, Hydrogen and
Renewables] at https://www.novatek.ru/en/press/
Mitrova, Tatiana, Ekaterina Grushevenko, and releases/?id_4=4501
Artyom Malov. 2018. The Future of Oil Production
In Russia: Life Under Sanctions. Moscow: Energy ———. 2021d. “Project Arctic LNG 2.” Novatek
Center of the Moscow School of Management Business, October 25. Accessed October 31, 2021.
SKOLKOVO. Accessed October 31, 2021. https:// https://www.novatek.ru/en/business/arctic-lng/.
energy.skolkovo.ru/downloads/documents/SEneC/
research04-en.pdf.
Oil and Capital. 2021. “Russia Will Take
20% of the Hydrogen Market – Novak.”
Morvesti. 2021. “Oil Production in the Russian June 4. Accessed October 31, 2021. https://
Federation: Peak Passed?” May 17. Accessed oilcapital.ru/news/markets/04-06-2021/
October 31, 2021. http://www.morvesti.ru/ rossiya-zaymet-20-vodorodnogo-rynka-novak.
themes/1694/89616/
Country Horizon: Russia 27References
Petlevoy, Vitaly. 2019. “Rosneft Decreased RIA Novosti. 2021a. “Too Late: Gas Transit Through
Production on the Largest Field. Vedomosti, Ukraine Collapsed to a Minimum.” January 17.
February 12. Accessed October 31, Accessed October 31, 2021. https://ria.ru/20210117/
2021. https://www.vedomosti.ru/business/ tranzit-1593265157.html.
articles/2019/02/12/793974-rosneft.
———. 2021b. “Ukraine Demanded a Long-term
President of Russia. 2021a. “Plenary Session of Contract for the Transit of Russian Gas.” July 13.
the International Forum ‘Russian Energy Week’.” Accessed October 31, 2021. https://ria.ru/20210713/
Accessed October 31, 2021. http://www.kremlin.ru/ tranzit-1741111558.html.
events/president/news/66916.
Savosin, Denis. 2021. “The Project for the
———. 2021b. “Plenary Session of the St. Construction of Plants for Processing and
Petersburg International Economic Forum.” Liquefaction of Natural Gas in Ust-Luga Was
Accessed October 31, 2021. http://www.kremlin.ru/ Approved.” Neftegaz, March 19. Accessed
events/president/news/65746. October 31, 2021. https://neftegaz.ru/news/
Gazohimija/671827-odobren-proekt-stroitelstva-
Prime. 2021. “The Ministry of Energy is Developing zavodov-po-pererabotke-i-szhizheniyu-prirodnogo-
a Strategy for the Development of Hydrogen gaza-v-ust-luge/.
Energy.” February 16. Accessed October 31, 2021.
https://1prime.ru/energy/20210216/833053492.html. Sea News. 2021. “Glavgosexpertiza Approved an
LNG Plant Near Ust-Luga.” March 22. Accessed
Rassokhin, Alexander. 2021. “The Gas Directive October 31, 2021. https://seanews.ru/2021/03/22/
Turned out to be Stronger.” Kommersant, August ru-glavgosjekspertiza-odobrila-spg-zavod-v-rajone-
25. Accessed October 31, 2021. https://www. ust-lugi/.
kommersant.ru/doc/4957769.
Shtykina, Alisa. 2020. “A Challenging Year for LNG.”
Reuters. 2021a. “Russia Approved a Strategy Morvesti, September 2. Accessed October 31, 2021.
for the Development of LNG with the Goal of http://www.morvesti.ru/analitika/1691/85524/.
Capturing 20% of the Market by 35.” Reuters,
March 22. Accessed October 31, 2021. https:// Starinskaya, Galina. 2018. “Production at the Vankor
www.reuters.com/article/orubs-russia-lng-strategy- Field of Rosneft Fell by 15%.” Vedomosti, January 9.
idRUKBN2BE1GQ-ORUBS. Accessed October 31, 2021. https://www.vedomosti.
ru/business/articles/2018/01/09/747198-dobicha-
———. 2021b. “Delay to Russian Nord Stream-2 gas vankorskom-mestorozhdenii.
pipeline may not be long - analyst.” November 22.
Accessed November 22, 2021. https://www.reuters. Statista. 2021. “U.S. Dollar (USD) to Russian
com/markets/europe/russian-gas-flows-germany- Ruble (RUB) Exchange Rate from January 2012
via-yamal-pipeline-are-steady-2021-11-22/. to September 29, 2021.” Accessed October 31,
2021. https://www.statista.com/statistics/376232/
usd-rub-exchange-rate-monthly/.
Country Horizon: Russia 28You can also read
