Gazprom Announces Record Production at Kirinskoye Natural Gas Field – OilPrice.com

Gazprom’s Kirinskoye gas condensate field, launched nine years ago on the Sakhalin plateau, has define a new level of production this quarter, revealed the general director of Gazprom Dobycha Shelf Yuzhno-Sakhalinsk, Valery Guryanov.

“Summer and fall, as weather and field operating conditions permitted, the company worked to continue infrastructure development and modification of the Kirinskoye field. This has already yielded significant results. We reached a daily production record in October, approaching figures of 9.3 million cubic meters of gas“, Guryanov said.

This is a big leap considering that the field only managed to produce 0.782 mcm in 2020 and 1.2 mcm in 2021. Kirinskoye is the first field in Russia where production is carried out from a production complex submarine. The planned production plateau is 5.5 billion cubic meters of gas per year.

Last week, Russia’s main news agency TASS reported that Gazprom’s board had approved a record spending of 2.3 trillion rubles ($33.1 billion) for the coming year.

“The board of directors approved the investment program and the budget of Gazprom for 2023. The indicators of the investment program have not been checked against the version approved by the executive committee of Gazprom in November this year . Funding for the investment program for 2023 will total 2.3 trillion rubles,the company said. Gazprom is the world’s largest natural gas producer with more than 18 trillion cubic feet in 2021.

It will, however, be interesting to see how Gazprom copes with the recently implemented natural gas price cap. After initially finding themselves at an impasse amid deep divisions, EU ministers finally reached an agreement to put in place a gas price cap of €180/MWh, well below the trigger threshold of €275/MWh originally proposed by the European Commission. Under the current proposal, the EU price cap would not fall below €188/MWh, even if the LNG benchmark price fell much lower. However, the EU gas price cap would move with the LNG benchmark price if it increased to higher levels, remaining €35/MWh above the LNG price. This system is designed to ensure that the bloc can bid above market prices to attract gas supplies in tight markets.

By Charles Kennedy for Oilprice.com

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