No need for haste on the Shtokman project

Nov 26, 2009 01:00 AM

The uncertainty surrounding the demand for gas on the markets in both Europe and USA encourages the partners in the Shtokman project not to make hasty compromises on technical solutions.
The framework for the first phase of the giant Shtokman filed in the Barents Sea has become an issue for debate between the project's operator Shtokman Development AG and Gazprom Dobycha Shelf, who owns the license to the field.

Vice President Jean-Jacques Mosconi of Total, who owns 25 % of the stocks in Shtokman Development, recently told that production of gas will start at the field only in 2015, and that the first LNG will be delivered in 2016. Total's reserved position could be an advantage for the Russian gas giant, as it comes from one of the foreign companies that became partners in the project precisely for solving the many technical challenges.
Another reason for the foreign partners to avoid taking hasty decisions in the project is the numerous problems at Statoil's LNG plant at Melkoya outside Hammerfest. Production at the plant was stopped earlier after just having started after a three months stoppage for repairs and maintenance.

The production stop can cost Statoil as much as NOK 1 bn. Five to seven shipments of LNG will be lost during the two weeks the stop is waited to last. Every shipment is worth NOK 140 mm in today's gas prizes.
Gazprom officials have also indicated the previous deadline could slip. The company's deputy chief executive Alexander Medvedev told in September that Gazprom could delay Shtokman if gas demand in Europe doesn't recover fast enough.

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