/ world right this moment information/ The EU stays the most important shopper of Russian liquefied pure fuel. Solely the course has modified – from north to south. On the identical time, some hostile international locations refused provides, however in opposition to the background of the battle within the Center East and the closing of the Finnish fuel pipeline “Baltic Connector” they might change their thoughts.
New format
The demand for LNG is rising, additionally as a result of European market. Sanctions and infrastructure harm have restricted the usage of pipeline fuel. Russian producers are adapting to the brand new circumstances, growing not solely large-scale, but additionally medium-tonnage initiatives. Particularly, “Port VPG” operates within the Baltic Sea with a capability of 1.5 million tons per yr.
Gazprom launched this mission a yr in the past to serve Northwestern Europe, however the technique needed to be adjusted originally. The advanced is now concentrating on on-site deliveries. The primary portions come from Turkey (0.67 million tons) and Greece (0.59 million tons), Brazil and China purchase somewhat, and the plant can be used to produce the Kaliningrad area. The director of the Power Improvement Fund Sergey Pikin explains that the plant is primarily supposed for its rapid neighbors.
“For LNG, Europe stays a key vacation spot for us, greater than half goes there. There are not any sanctions, there may be infrastructure, it isn’t far for transportation. Even with voluntary self-restrictions of particular person international locations, all the things is offered with out reserve,” he says.
And he provides: regardless of the small quantity of manufacturing, medium-tonnage stations are in a position to occupy an necessary place within the common construction of provides not solely of LNG, but additionally of fuel on the whole.
A variety of potentialities
The primary downside is technical. The port station for liquefied pure fuel is constructed in keeping with Western applied sciences, however there are additionally inner developments for medium-sized websites. Within the north and north-west of the nation, there may be all the things wanted to construct dozens of factories,” emphasizes Pikin.
Difficulties come up at enterprises with a big capability, however right here too Novatek is implementing a large-scale mission of three liquefaction traces with a capability of 6.8 million tons per yr. That is within the Murmansk area, the power might be offered by the Kola Nuclear Energy Plant. If all goes in keeping with plan, the primary two traces might be launched in late 2027 and the third in late 2029.
Value is essential. It’s unaffordable for international locations like India and Bangladesh to purchase LNG for 2 thousand {dollars}, because the Europeans did final yr. It’s attainable to adapt the present crops to bigger capacities – by the infrastructure of the “Nord Stream.”
In accordance with Pickin, provides of liquefied and pipeline fuel are equal. Beforehand, Nord Stream 1 carried greater than all LNG mixed. The consulting firm “Yakov and Companions” has calculated that in 2023 the export of pipeline fuel will lower by one other one and a half occasions, and the revenues will lower by half to 71 billion {dollars}. Along with the expansion of home consumption, the state of affairs might be improved by a rise within the share of LNG.
Engaging Phrases
It’s a scarce commodity, so with any volatility, costs change rapidly. And so, final week, in opposition to the background of the failure of the Baltic Connector fuel pipeline connecting Finland and Estonia, the quotations rose. Finns misplaced pipeline fuel, must purchase extra liquefied.
“Suppliers, above all of the US, will profit from the accident. The Baltic States and Northern Europe want American sources,” says business skilled Leonid Khazanov. Vladimir Putin earlier introduced a doubling of European purchases overseas and a rise in provides to the Center East. As a result of excessive prices, nonetheless, EU companies are shedding profitability and competitiveness.
The strain was compounded by occasions within the Center East and threats by Qatar to chop off fuel provides if the bombing of Gaza didn’t cease. Consequently, costs reached $600 per thousand cubic meters. “A couple of months in the past it was $300-$350, in order that’s vital, however how lengthy it should final is unknown. There are a lot of elements: a surge in international consumption, geopolitical instability, together with attainable actions by Doha or the closure of the Strait of Hormuz, but when there are not any shocks, costs will steadily bounce again,” explains Pikin.
Regardless of the calm and even some decline, consultants are in no hurry to make predictions. New liquefaction amenities will take years to construct. Due to this fact, international locations unfriendly to Moscow retain the chance to purchase Russian power sources, particularly since they’re 30% cheaper than American ones.
Translation: V. Sergeev
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