BIG OUTLAYS SEEN REQUIRED FOR GAS PIPELINES IN RUSSIA

Nov. 27, 1995
A study by Russia's Gazprom and the European Bank for Reconstruction & Development (EBRD) has cited a need for more than $3 billion to be spent to improve Russia's massive gas pipeline grid. EBRD said $500 million/year will need to be spent until 2000. It is considering financing of upgrade projects that "add value and catalyze additional investment." The Gazprom network consists of more than 140,000 km of main line and 250 compressor stations. It transports more than 600 billion cu

A study by Russia's Gazprom and the European Bank for Reconstruction & Development (EBRD) has cited a need for more than $3 billion to be spent to improve Russia's massive gas pipeline grid.

EBRD said $500 million/year will need to be spent until 2000. It is considering financing of upgrade projects that "add value and catalyze additional investment."

The Gazprom network consists of more than 140,000 km of main line and 250 compressor stations. It transports more than 600 billion cu m/year of gas, of which 240 billion cu m/year is exported.

Vladimir Rezunenko, Gazprom director and chairman of the study's management committee, said the findings will help Gazprom market itself as a major and reliable gas producer and delivery partner.

"Despite an overall high reliability in supply," Rezunenko said, "the system is vulnerable to hazards caused by a lack of investment and monitoring procedures and the physical condition of the pipeline.

"Corrosion, instability caused by difficult terrain and climate, and operating practices are earmarked by the study for improvement. Gazprom is working on most of these areas to over- come problems."

EBRD said the Gazprom network is the largest in the world but was built to meet centrally decided production and technical targets-not economic and financial targets, as with western net- works.

The bank said major hazards include:

  • Increased corrosion problems due to lack of adequate pipe coating, inspection, and cathodic protection, as well as a lack of insulating joints.
  • Deficiencies in assuring reliability of major river crossings, where flood plains are wide as 30 km, and pipeline corridor intersections and slope stability in mountainous areas.
  • Inefficiencies of compressor stations along some pipeline corridors.
  • Unnecessary venting and gas leaks due to pipe ruptures, leaking valves, and lack of pipelines repairs.
  • A need to improve centralized technical databases and information systems.
  • Lack of environmental standards that meet western levels.
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