Putin Hints at Opening for Gazprom Rivals with LNG

Russian President Vladimir Putin has indicated he is willing to put an end to Gazprom's monopoly on natural gas exports by allowing rival companies to ship liquefied natural gas (LNG) abroad.

The move is being considered because Russia, despite having the world's largest gas reserves, continues to lag behind other exporters in tapping the high-value LNG export market.

Russia only accounts for 3.6% of the global LNG market, Putin said at a meeting of top government and energy-firm officials at his residence on the outskirts of Moscow.

The meeting was examining development issues, including Russia’s continental shelf, drafting a state industrial security policy concept, and energy exports.

According to Reuters, the Russian president had been challenged by a close associate, who said he feared Russia would lose out on the lucrative LNG market to Asian countries.

The associate, Igor Sechin, is chairman of Rosneft, Russia's leading petroleum company, which is also increasing activities with gas.

Putin said that building and overhauling LNG facilities could take up to 10 years. "We have to put all the right conditions in place for developing this sector. This includes reflecting on possible gradual liberalization of LNG exports and organizing production of the required technical equipment here in Russia,” the president told the Commission for Strategic Development of the Fuel and Energy Sector and Environmental Security. The meeting was reported on the official Kremlin website.

 The meeting also examined measures for guaranteeing transparency for energy sector companies with state stakes. Putin commented that Russia's resource potential has been undervalued because of "archaic estimation methods."