Gazprom beats Novatek in Arctic licence contest
Russian state gas supplier Gazprom has acquired a licence to explore the Vostochno-Bovanenkovsky gas block on the Arctic Yamal Peninsula, after outbidding rival Novatek in a contest, Russia's natural resources ministry reported on March 30.
Gazprom spent 386mn rubles ($5mn) to acquire rights to the 3,200-km2 area, which lies adjacent to the Bovanenkovskoye field, one of the company's largest sources of gas production. The block holds some 19.2bn m3 of gas in C1+C2 resources. Vostochno-Bovanenkovsky is also situated next to the Verkhnetiuteyskoye and Zapadno-Seyakhinskoye fields, operated by Novatek subsidiary Obsky LNG.
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Gazprom is looking to establish Yamal as its largest hub for gas production. The company has rights to 32 fields on and off the coast of the peninsula, which it estimates contain 26.5 trillion m3 of gas. These fields could one day flow 360bn m3/year of gas, according to Gazprom. The company wants to route some of this supply to China via the proposed Power of Siberia 2 pipeline set to run through Mongolia.
Bovanenkovskoye is currently the only Gazprom field in operation in the region, producing 96.3bn m3 of gas in 2019. It will be joined in 2023 by the neighbouring Kharasaveyskoye field, where Gazprom began drilling the first production well in June last year.