Gazprom Sees LNG as Future of Shtokman 2 and 3

Deputy chairman of Gazprom Alexander Medvedev has said that all three phases of the Shtokman gas project in Russia could be focused on LNG.

Speaking to reporters following a conference in Kuala Lumpar yesterday, Mr. Medvedev said there was a "good chance" that liquefied natural gas would form the basis for operations on the entire Shtokman project. 

"Our decision to switch to 100 percent LNG is a reflection of the supply-demand balance in Europe," Reuters news agency reports the executive as saying.

The Shtokman field, which is one of the world's largest gas projects, has in recent times faced challenges in operations and financing, with a final investment decision (FID) on the project delayed several times due to tax issues.

Following rumours last month that 24 per cent stakeholder Statoil was considering withdrawing from the project, Gazprom made the announcement that the consortium would abandon plans to build a pipeline from the field to Europe, instead focusing on bringing LNG to Asia.

"The balance between pipeline and liquefied gas is changing toward LNG," chairman of Gazprom's Board Alexey Miller said last month. "We are talking about 100 percent liquefaction except for gas intended to supply (the nearby) Murmansk region. 

A formal plan for the project is expected for later this month, which may include extra stakeholders in the project. Dutch major Shell has been rumoured to be pursuing a stake in the project, with talks between Gazprom and Shell reported to already be underway.

Gazprom is the operator of the Shtokman project with a 51 per cent stake. French major Total holds a 25 per cent stake with Statoil holding the remianing 24 per cent stake.