“Russia sits on 25% of the world’s gas reserves and is very, very close to markets that we are very familiar with,” Van Beurden said July 30, on the sidelines of the company’s earnings presentation. Shell is also pushing “to see how we can work with Gazprom internationally.”
The Arctic has become a theatre for rival claims over a sea floor believed to be rich in minerals, oil and gas.
The United States is now the world’s leading producer of natural gas. With LNG exports scheduled to begin within the next six months, America’s oil and gas renaissance will soon provide both substantial domestic and foreign economic benefits. If US LNG can be imported into regions where there is only a single, monopolistic producer, then strategic benefits could accrue as well.
In the medium term, Iran’s gas will not be able to compete with the Russian gas in the European market.
US LNG export projects face an uncertain future despite continued discoveries and production growth, a Brookings Institution analyst said. “More liquefaction capacity may be coming than markets can absorb,” warned Tim Boersma, acting director of Brookings’s Energy Security and Climate Initiative.
In May 2008, the company’s market capitalization reached $367.27 billion, making it one of world’s most valuable companies, according to a survey compiled by the Financial Times. Gazprom’s deputy chair, Alexander Medvedev, repeatedly predicted at the time that within a decade the Russian energy giant could be worth $1 trillion.
Gazprom's gas prices are pegged to oil with a six-month lag, which means its customers are currently paying the equivalent of $45-$50 per barrel seen in January 2015 when oil prices crashed following a decision by OPEC not to reduce output.
US shale gas is the unexpected loser from President Barack Obama’s climate plan, as the White House abandons its previous enthusiasm for natural gas as a cleaner alternative to coal.
There are indeed compelling reasons for Gazprom to do a deal. First market developments are rendering Gazprom’s existing business model irrelevant and it is that business model which is being substantially challenged in the antitrust case. Secondly, the consequences of an actual published EU competition decision against the company would be devastating in terms of reputation and scale of liability. Both these factors provide compelling incentives for Gazprom to file draft Commitments to the Commission to provide a basis for a deal.
In the second quarter and first half 2015, our total revenues increased by 27.0% and 27.6%, respectively, compared to the corresponding periods of 2014. The growth was mainly due to an increase in liquids sales volumes and net prices in Russian rouble terms. Average net prices of liquid hydrocarbons were positively impacted by the substantial increase in sales volumes of high value-added petroleum products from the Ust-Luga Complex, the decrease in export duty rates and rouble devaluation against the US dollar, which more than offset the decline in international hydrocarbon prices.