LNG Business Development

LNG business development is one of the key priorities of Gazprom Group operations. Its aim is to increase natural gas export volumes by entering new markets inaccessible to pipeline supplies. Gazprom Group has been actively ramping up volumes of its LNG trading portfolio both through the implementation of its own projects as well as through LNG purchases from third parties. The portfolio approach to LNG trade operations makes it possible to react quickly to changing market conditions, follow the geographical diversification of supplies, and to optimize transportation costs.

The aggregator of LNG volumes and primary operator of the Group’s trading portfolio is Gazprom Marketing & Trading company. Gazprom Export's LNG operational center in Saint Petersburg is functioning in close coordination with offices in London and Singapore.

Large-Scale LNG

The basis of Gazprom Group’s LNG trading portfolio currently consists of LNG supply from the Sakhalin II project. Additionally, LNG is also purchased from third parties under long-term contracts, fixed-term agreements and spot deals. In 2005–2019, Gazprom Marketing & Trading delivered over 450 LNG shipments (including 190 from the Sakhalin II project) of total volume around 32 mln t to the markets of over 15 countries. In 2020, due to the active development of spot and short-term trading activity Gazprom Group sold 110 LNG shipments of a total volume of 7.4 million t in 14 countries, thus almost doubling the results of 2019.

Gazprom Group is actively operating in LNG markets of the Asia-Pacific Region, delivering both to traditional markets, like Japan, South Korea, Taiwan, as well as to the fast-growing markets of China, India, and Southeast Asia. In 2020, the Asian-Pacific region amounted to 49% of the Gazprom Group's LNG sales. India became the largest buyer with 1.8 million t. 

To expand its market presence in the countries of the Atlantic basin, Gazprom is also working to develop its own LNG project in Leningrad Region. In May 2021, Gazprom PJSC and RusGazDobycha JSC have started the construction of a complex project aimed at processing ethane-containing gas and producing LNG near the settlement of Ust-Luga, Leningrad Region. The project envisages construction of capacities for the processing of 45 billion cubic meters of gas and for production and shipping of 13 million tons of LNG, up to 4 million tons of ethane and over 2.2 million tons of liquefied petroleum gases (LPG) per year. The gas remaining after the processing will be sent into Gazprom’s gas transmission system. The first train of the complex is expected to be put into operation in the second half of 2023 and the second train in late 2024.

Another project that can increase the volume of Gazprom Group’s LNG trading portfolio in the Atlantic region is a complex for the production, storage, and shipment of LNG in the Portovaya compressor station (CS Portovaya) in Vyborg district of Leningrad Region, with a capacity of 1.5 mt of LNG per year. The construction of the project is nearing its completion.

Small-Scale LNG (ssLNG)

In 2020, Gazprom Export exported 611,3 million t of ssLNG, which is 38% more than in 2019. Most ssLNG comes from the Vysotsk LNG plant, which is the first medium-scale LNG project in the Baltic region.

In 2019, the first ever ssLNG from Russia's Yakutia was shipped to Mongolia in the railway cryocontainers. The fuel was produced by SITEK. n 2020, Gazprom Export diversified the sources for ssLNG supplies to Mongolia and organized multimodal supplies of ssLNG, produced by Sibir-Energo in Kemerovo Region, by railway and heavy duty transport.