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Russia’s Gazprom Proposes Network of CNG Filling Stations in Europe
27 June 2008
RIA Novosti. Russia’s Gazprom is proposing opening a chain of natural gas vehicle filling stations across Europe.
“We propose drawing up a joint project to establish a chain of natural gas filling stations to our European partners,” Alexei Miller [chairman of Gazprom’s Management Committee] told an annual shareholder meeting.
“There is no and will be no viable alternative to fossil fuels in the next ten years,”Miller said adding that plans to switch to biofuels has provoked a global food crisis.
Gazprom is the world’s largest gas company focused on geological exploration, production, transmission, storage, processing and marketing of gas and other hydrocarbons. The company possesses the world’s largest natural gas reserves. The Russian state owns a 50.002% controlling stake in Gazprom.
According to the US Energy Information Administration, for Gazprom to fulfill its long-term aim of increasing European sales, it will need to boost its production, as well as to secure more reliable export routes to the region. According to recent data from IHS Energy cited by the EIA:
Gas production at Gazprom’s top four gas producing fields (not including the newly online Zapolyarnoye field) declined by 4% or 430 Bcf (12 billion cubic meters or Bcm) from 2005 to 2006.
Gazprom’s newest field, Zapolyarnoye, is responsible for much of the growth in Russia’s gas industry, but only increased by about 170 Bcf (5 Bcm) in 2006. Overall, Gazprom’s production growth was flat year-on-year.
Based on EIA analysis, Gazprom’s production from its largest four fields is expected to decline by around 1,800 Bcf in the next four years. Gazprom’s targeted production for 2011 is an increase of around 1,000 Bcf from 2007 levels. Therefore, net of increases from the Zapolyarnoye field (800 Bcf), Gazprom must increase its production by around 2,000 Bcf to meet its targets. On an annual basis, that translates to around 500 Bcf per year (or 14 Bcm).
The average level of depletion at Russia’s five largest producing fields (not including Zapolyarnoye) was almost 50 percent in 2006, weighted by production.
Although Gazprom projects increases in its natural gas output between 2008 and 2030, most of Russia’s natural gas production growth will come from independent gas companies such as Novatek, Itera, and Northgaz, according to the EIA.
Gazprom’s proposal comes in the context of ongoing disputes between the European Union and Russia over energy, security and other issues.
(A hat-tip to John!)
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Comments
Would innefficent ICE liquid fuel guzzlers become inefficent ICE NG guzzlers?
Wouldn't be less costly to supply 100++ EU converted NG power stations to produce relatively clean electricity for future PHEVs and BEVs and to meet peak power demands?
Either way, what would happen when Russia turns it off or multiplies the price?
Posted by: HarveyD | Jun 27, 2008 9:49:04 AM
Russia’s Gazprom is proposing to convert cars to a fuel that does not exist. The full natural gas supply is already sold, and demand is already greater than supply. Unless they also come up with a way to satisfy their current customers, there will be serious shortages.
Planning to sell the same natural gas twice is pushing the envelope of stupidity.
Posted by: John Taylor | Jun 27, 2008 10:42:44 AM
If you look at natural gas prices you can see why Gazprom are doing this – in the UK, natural gas today costs 60 p/therm, oil costs $140/bbl. Gas is less than half the price of oil in energy terms, it has never been so relatively cheap. We have 3 new LNG importation plants but none are bringing in gas as we have plenty from Norway.
Gazprom sell gas, they have a lot of it, they have huge financial resources, why not move into the transport market to keep demand up (demand for gas to make electricity will fall in long term as wind turbines and nuclear come on stream).
In the UK, from 2016 new homes have to be zero carbon, so no gas supply - and UK gas demand from domestic and I&C is already falling. Gas producers need to find new markets for gas.
In addition, now that the major EU OEMs like VW (new CNG Passat) and MB (new B Class) are launching new high performance high spec NGVs (as opposed to first generation which were basically petrol conversions) the market is set to grow dramatically.
25% lower CO2 than petrol, half price fuel, next to zero NOX and Particulates.
In India there have been announcements re launches of right hand drive NGVs by Toyota, Mercedes, Fiat, Proton, Hyundai and GM in the last month or so. All because CNG is cheap and low CO2.
The NGV market is incredibly dynamic at the moment, if you add a hybrid and you can have a Mondeo sized car at 90 g/km!!! No other internal combustion engine can compete with this.
Posted by: John Baldwin | Jun 27, 2008 10:49:47 AM
John....thanks for some intelligent comments...unlike the previous dribble....
In addition...their is a lot more NG out there, when new techniques are included....and biofuels are better left as biomass and used directly for heat and electricity.....
Posted by: mikef | Jun 27, 2008 11:21:14 AM
If you're going to use NG for transportation (assuming there is a large enough supply ... tight gas, deep gas, gas hydrates, bio gas etc...), then ANG would be the way to go.
If I were European, I'd be a little nervous about getting all of my energy from Russia ... who have shown a willingness to use energy as a political bludgeon.
Posted by: Neil | Jun 27, 2008 1:34:48 PM
@J. Taylor
Natural gas is already more expensive for heating than using electric heat pumps. Therefore, already people are converting from oil and natural gas to electric heat pumps. This will ‘liberate’ mainly natural gas for other purposes such as transportation. Alexei Miller (or another top guy from Gazprom) said a few weeks ago that oil would hit $250 soon. If it does the price of natural gas will follow suit and this will really start a massive ‘liberation’ of natural gas from private and industrial heating to other uses. Since natural gas is up to 50% cheaper than gasoline in energy equivalents it makes sense to use the ‘liberated’ natural gas for transportation. I think this is why Gasprom want Europe to start building CNG stations.
Unfortunately, Gasprom is somewhat correct when they say that in the next ten years there are no viable alternatives to fossil fuel. Even if we build a fast charge infrastructure now for EVs it will probably take 10 years before it is possible to at best produce more than 10 million EVs per year globally and at that time the world will likely do about 95 million vehicles globally (76 million projected this year 2008) and the global stock of vehicles will be getting close to a billion vehicles (622 million passenger vehicles in 2005). In 10 years biofuels will be very big of cause especially if oil hit $200 or more soon.
To conclude, in order to prevent that increasing fuel prices create a long-term global recession we need the combined use of flex fuel natural gas vehicles, much more biofuels, and a lot of EVs and PHEVs. The scale of the problem is simply immense and there is no quick fix to our addiction to fossil fuel. In 20 years from now I would not be surprised if all new vehicles where EVs but there would still be a billion or maybe two billion ICE vehicles around for another 10 years so oil will be in demand until it is depleted or made illegal to burn as a last measure to save the planet from the horrors of global warming.
Posted by: Henrik | Jun 27, 2008 1:38:01 PM
There is one aspect of NG fueled cars that is rarely mentioned, and that is that people can make and compress their own fuel fairly cheaply. PHILL is a home compressor built in Canada and runs off of electricity. Fermenting sugar and starch containing materials into methane is quite fast and requires little space, and even waste fruits and vegetables can be used. The CO2 produced by the fermentation is easily separated when liquified at the CNG pressure. The compression energy can be partially recovered and more with a tiny turbo generator with the gas preheated by exhaust heat for even more power. Other organic materials can be used with larger digestors. In the US there is a Coal to Methane production unit that is now proving its value in the high priced methane market. Actually coal to gas factories can also produce very valuable fertilizers from the nitrogen compounds already in the coal as well as other byproducts. This nitrogen is wasted in ordinary coal fired power plants. The coal tars that could be produced could also partially substitute for a fraction of the crude oil at oil refineries. And in fact, a new crude refinery would be built to have coal delivered for all its energy requirements and for making hydrogen.
Low temperature hydro-oxidation can convert paper and cellulose and other materials into acetic acid that is also rapidly anaerobically converted to methane and CO2.
A computer controlled gasifier could even be used in CNG cars to make a usable low performance gas out of diesel or gasoline or ethanol for emergency, out of range, use. ...HG....
Posted by: Henry Gibson | Jun 27, 2008 3:39:19 PM
There is an important CO2 angle to this too:
See
http://ies.jrc.ec.europa.eu/wtw.html
If you look in the Well to Wheel Slides, slide 34 says:
Beyond 2010, greater engine efficiency gains are predicted for CNG vehicles, especially noticeable with hybridization
We are not far from 2010, everything that you would want to happen to promote NGVs is happening - high oil price (the gas between oil and natural gas has never been as large as this), less use of natural gas in the long term for heating and electricity, liquid biofuels in disrepute, new NGVs being produced by OEMs (eg VW Passat and MB Sprinter being launched in 2008 in Germany - the first properly engineered and thought out CNG cars and vans ever). If you want you can include the growth in EU of renewable methane (eg Veolia annoucement yesterday in France).
It could be that Gazprom have joined these dots before others.
Posted by: John Baldwin | Jun 28, 2008 2:34:29 AM
Interesting comments.
It is encouraging to see the market for Russia's Natural gas beginning to deteriorate. I'm sure that the instability of supply was a big factor.
In the USA there is a plan to "liberate" Natural gas from electrical power generation and power cars with it. This same sort of plan in Europe is similar, because the new electrical supply will be from Wind power.
The LNG switch keeps the fossil fuel industry going for years, so I can see why it is promoted.
However, with renewable power being cheaper than coal power, and new BEV products hitting the market in at least four countries that now are building infrastructure to support them, there will be a significant incentive to build competitive.
If the BEV is demonstrated in Israel, Denmark, Japan and Britain, then demand in other countries (especially China) will soar. We may well see the 100 million units a year production number be reached.
The stone age didn't end because of a shortage of stone.
Posted by: John Taylor | Jun 28, 2008 4:08:01 AM
Ode to simpler times.
E5,E10,E20,E85,E100. methanol wet or dry?, methane, propane, butane,LPG,Autogas, NG,CNG,ANG, LNG, Unleaded, premium(high octane),Avgas, deisel, bioideisel, Aviaton deisel, jet-A1, Power kero (for us oldies), They all work.
Syngas and hydrogen Absorbed and liquified, cryogenically cooled .
Excuse me if I must leave out a few specialty fuels, But at what point does sanity prevail?will we need to pack a lunch to walk from bowser to cashier?
My poison of choice (for what its worth) is A type of NG.
3 or four of these fuels may have been viable in the old system. Which way do we jump when the possibilities increase beyond 23.
I only have two hands and two feet to count on.
One must see for the sake of simplicity the benifit to D.M.E.
-23o C
If ICE engines are to reach their full potential.
While this one may not make the bed it will clean the sheets.
Posted by: arnold | Jun 28, 2008 4:41:23 AM
I trust Gazprom and German Socialist PM Gerhard Schroeder, like I trust Pravda.
Cartoons are fun too.
The last action Europe needs to take regarding future fuel dependency is to become ever more dependent on an aggressive and rising red bear.
The same red bear that is building a nuke for proxy Iran and supplying weapons for other proxy Syria.
This would leave Europe exposed both to Russia and Iran.
The best long term future is battery, solar, wind, bio 3.0, latest clean coal tech, nuke thermo.
Why depend upon others that hate you and fund your enemies? We've done this long enough and need to learn our lessons to once and for all leave these relations to their natural dying ends.
Drill Now, Drill Here short term, All other investments for Long Term must be redoubled in efforts and funding.
Funny how Norway and England has no problem drilling in the North Sea.
Posted by: Michael | Jun 29, 2008 12:22:15 PM
