Gazprom Raises 2017 Investment Plan by 24%
Gazprom has reported an increase in its investment programme for 2017 to rubles 1,128 trillion ($19.66bn). This marks an increase of rubles 217.3bn (23.9%) on the initial figure approved in December last year. The main reason cited for the rise was the need for capital investment and future purchases.
The board of directors also approved a new version of the company's budget and its optimisation programme for 2017.
The cost of capital investments has reached rubles 738.5 billion (a rise of rubles 112.5 billion) and that of acquiring assets to rubles 11.31 billion. Long-term financial investment has risen by rubles 93.6 billion, to rubles 378.7 billion.
In a recent review credit ratings agency Fitch noted that Gazprom will have to borrow rubles 600bn annually ($10.35bn) and that by early 2020 this debt will have increased by rubles 1.8 trillion.
Gazprom’s major pipelines
Over the next three years Gazprom will have to borrow a record amount in order to finance its mega-pipelines that will bring gas to Europe and China.
The three major projects – NordStream 2, TurkStream and Power of Siberia – will cost in total around rubles 1.35-1.45 trillion.
Gazprom CEO Alexei Miller said September 27 that almost 300km of the TurkStream gas pipeline has been built.
The company released a report October 17 saying that Gazprom has also completed 1,095km of its Power of Siberia gas pipeline to China and that construction is proceeding at an “advanced pace”. The pipeline will supply gas from Yakutia and the Irkutsk region to eastern Russia and China.
“To date, more than 1,095km of the pipeline, or 50.7% of the total length of its prime section from the Chayandinskoye field to Blagoveshchensk [the border with China] has been built,” the report said. The total length of the prime section will be around 2200km.
Gazprom is now building production equipment at the Chayandinskoye oil and gas condensate field; so far 86 gas and 8 oil wells have been completed.
Gazprom published a report October 2 saying that its gas production rose 19.1% year on year to 339.8bn m3 in January-September 2017. Its exports in that period also increased, by 11.3% to 141.2bn m3. Those to Germany rose 10.7%; to Austria up 54%; the Czech Republic up 28.4%; Slovakia up 31.3% and to France up 7.1%.
Ilham Shaban, Dalga Khatinoglu