Russian gas export monopoly Gazprom may delay some projects in response to weaker demand for gas and a tougher financial climate but expects to decide to proceed with the giant Shtokman gas field early next year. Chief Financial Officer Andrey Kruglov told a press conference on Tuesday that the company was still deciding on its plans for the year.
“We have also been prioritizing projects in our investment program ... and this will allow us to see which projects will be financed and which projects are going ahead,” he said, speaking through an interpreter.
However, key projects will go ahead as planned, including developments in the Yamal peninsula and the Shtokman field, one of the largest gas fields in the world, which Gazprom is developing with France’s Total and Norway’s StatoilHydro.
“The investment decision will be made in the first quarter of 2010,” Alexander Medvedev, Deputy Chief Executive, said of Shtokman. Shtokman is scheduled to start producing gas for export by pipeline in 2013 and as liquefied natural gas in 2014, according to a company presentation. A spokesman said the project remained on track.
Medvedev added that, unusually for an oil and gas project, the Shtokman partners would incur considerable costs in advance of the decision on whether to proceed. Usually the final investment decision is the point at which companies start to incur high costs.
A spokesman added that the state-controlled company would continue paying dividends, in line with its policy, despite some fears these could be cut due to lower oil and gas prices.
Gazprom management was in London to give a presentation to analysts, prompting, traders said, the resurgence of persistent rumors that the world’s largest gas producer may make a takeover bid for the UK’s largest gas retailer, Centrica. “We are not in talks with either the shareholders or the management of Centrica,” Medvedev said. (Reuters)