HomeMediaLatest NewsNOVATEK will be offered a discount on gas pumping for a pipeline to Murmansk

NOVATEK will be offered a discount on gas pumping for a pipeline to Murmansk

10 April 2024

Belogoryev Alexey M. Research and Development Director, Director of the Center for Energy strategic analysis and forecasting

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to RBC on the cost of the Volkhov – Murmansk – Belokamenka gas pipeline and the proposed scheme for its purchase by Gazprom.

Gazprom may pay NOVATEK for the construction of the Volkhov — Murmansk gas pipeline with a discount on gas transportation across Russia, sources told RBC.

"With the declared capacity of 41.2 billion cubic meters per year, the cost of [the gas pipeline] may amount to about 450-500 billion rubles in 2024 prices," Alexey Belogoryev estimated.

However, according to Belogoryev, the scheme chosen for the Volkhov — Murmansk — Belokamenka gas pipeline is still unusual, "especially in the context of endless disputes between independent [gas producers] and Gazprom about how justified, overstated or, conversely, underestimated transportation tariffs are," as well as the discussed transition to a new calculation method of the tariff.

"That is, it is not completely clear how the tariff itself will be considered, for which it is planned to give a discount. It is important what this discount will look like: a single percentage for all supply lines, or will there be some kind of geographical differentiation. <...> And when will this discount be provided: already in the 2020s, simultaneously with investment costs for construction, or only after the fact, when the gas pipeline starts operating? It is also not entirely clear what resources Gazprom will use to compensate for the lost revenues from gas transportation. In other words, it is still difficult to objectively assess who benefits from this option. The devil is in the details," the expert says.

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