Russia early in the next century aims to play a bigger role in western European gas markets, as volumes decline from current key suppliers.
Norway's gas sales in Europe by 1999 under current contracts are to increase by about 600 bcf/year to 2.1 tcf, said Peter Mellbye, executive vice-president of Den norske stats oljeselskap AS (Statoil).
With total investment of about $25 billion, he said, the country's gas exports could be ramped up to as much as 2.8 tcf/year.
Norway currently exports 1.5 tcf/year of gas to Europe.
Boris Nikitin, a board member of Russia's integrated gas giant Gazprom, said western Europe by 2010 will need to import as much as 6.4 tcf/year of gas to meet projected yearly demand of as much as 17.7 tcf.
With ambitious Russian gas developments already under way, mostly in western Siberia, sales of Russian gas in the region could total as much as 1.4 tcf/year, he said.
Nikitin said Russia last year produced 21.1 tcf of gas, including 19.8 tcf by Gazprom.
Mellbye and Nikitin were addressing delegates attending the Offshore Northern Seas conference last week in Stavanger.
Western Europe's outlook
Western Europe's gas production by 2000 is expected to amount to about 12.7 tcf/year, but decline thereafter because of the region's limited reserves.
Mellbye said that to meet contractual gas sales obligations to European customers, Norway must construct several large subsea gas transportation pipelines, including:
- By 1998, a pipeline from the North Sea's Sleipner area gas hub to Dunkirk, France.
- By 1999, a line from the North Sea to northern Germany.
- By 2000, a line from Aasgard field in the Norwegian Sea to the onshore terminal at Karsto, Norway.
Mellbye expects remaining investments in gas transportation facilities, including all infrastructure and terminal facilities, to total about $11 billion.
"Total investment, past and planned, is expected to amount to $25 billion," he said.
After subtracting gas volumes sold or committed under existing contracts, Mellbye said about 50% of Norway's original gas resource base remains unsold.
"On the basis of proven reserves and possible new gas projects, we believe Norwegian gas exports could be increased to about 2.8 tcf/year, given the appropriate conditions," Mellbye said.
Russian gas development
Nikitin said Norway and Algeria are expected to increase gas supplies to western Europe to 1.8 tcf/year and 2.1 tcf/year, respectively.
Gazprom by then aims to boost its yearly gas output 20-25% to 23.5-23.7 tcf.
The company is working in 120 gas fields with combined reserves estimated at 883 tcf, mainly in western Siberia.
Nikitin said Gazprom by 1999 expects to begin developing Yubileinoye, Yamsovey, and Khavutin fields. Combined gas production of 1.4 tcf/year is expected in those fields.
The company also plans to start production at Zapolyarnoye field in 1998, with output rising to 3.2 tcf/year by 2005.
More than half of western Europe's gas demand growth by 2020 could occur in power generation markets, Nikitin said.
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