Russia holds the world’s largest natural gas reserves. According to BP Stats, 2004 Russia had proven natural gas reserves totalling 47 trillion cubic metres, produced 578.6 billion cubic metres (a 4.2% increase from 2002) and consumed 405.8 billion cubic metres during 2003.
Growth of Russia’s natural gas sector has been stunted primarily due to ageing fields, state regulation, Gazprom’s monopolistic control over the industry, and insufficient export pipelines. Three major fields (called the 'Big Three') in Western Siberia--Urengoy, Yamburg, and Medvezh'ye comprise more than 70% of Gazprom's total natural gas production, but these fields are now in decline; and the government and Gazprom both project steep declines in natural gas output between 2004 and 2020.
Russia has 17 relatively small LNG plants with an aggregate capacity of about 7 million tons. Petrochemical companies consume half of the output. The remainder is exported or used for housing or for transportation demand.
Gazprom, Russia's state-run natural gas monopoly, holds nearly one-third of the world’s natural gas reserves, produces nearly 90% of Russia’s natural gas, and operates the country’s natural gas pipeline network. Gazprom is also Russia’s largest earner of hard currency, and the company’s tax payments account for around 25% of federal tax revenues. By law, Gazprom must supply the natural gas used to heat and power Russia's vast domestic market at government-regulated prices regardless of profitability. Accordingly, roughly two-thirds of the company's revenue comes from its export sales to Europe, accounting for about 25% of Europe's demand for natural gas.
Gazprom participates in a number of international gas production and transportation projects. In consortium with Ruhrgas and Gaz de France, the Company became co-owner (49%) of the Slovak gas transportation system (SPP) in 2002. Jointly with Royal Dutch/Shell, ExxonMobil and Chinese PetroChina, the Russian company founded a joint venture to build the first trans-Chinese gas pipeline West-East. The plan calls for a 1.2 Bcf-per-year pipeline that would deliver roughly two-thirds of its natural gas annually to China, while delivering the rest to South Korea and smaller quantities to the domestic market en route. The partners expect that the pipeline could come online in 2008. In Iran, Gazprom, together with the French company TotalFinaElf and Malaysian Petronas, participates in the South Pars project in the Persian gulf.
Ref: http://www.eia.doe.gov
