The Moscow Times: Russia May Miss Out on the Golden Era of Gas

Russia lost its position as prime supplier of gas to Europe last year, with Norway edging Russia out of the No. 1 spot for the first time. Although Russia will remain a key supplier to Europe, it is also seeking to diversify export markets for its gas to Asia as part of the strategy to unlock frontier regions like the Arctic and Eastern Siberia for hydrocarbons development.

Gas production from these new regions is intended to enhance export capacity and to replace declines in existing fields. Dynamics in the global gas market are shifting, however, and Russia's ability to secure markets in Asia, which is crucial given that European markets are stagnant, will largely depend on its ability to navigate the challenges and opportunities that these shifting dynamics pose.

Just 7 percent of Russia's gas exports were sold to Asian consumers last year, all in the form of liquid natural gas, or LNG, from the Sakhalin II project. But Russia's gas exports to Asia will expand dramatically if the construction of two new LNG terminals goes ahead: Gazprom's Vladivostok and Novatek's Yamal projects. Rosneft also plans to build a terminal in Sakhalin. If these three projects are realized by 2020, Russia's LNG capacity would increase from 10 million tons per year to about 45 million tons, or to an amount equal to 18 percent of global LNG exports in 2012.  MORE