Alexey Gromov, Principal Director on Energy studies at the Institute for Energy and Finance, made a detailed comment to the Mashnews Internet portal on the feasibility of creating a strategic oil reserve system in Russia.
Such an oil storage facility is necessary for the implementation of the Vostok Oil project in the Arctic, so as not to stop production during periods when oil cannot be exported due to severe weather conditions.
The natural and climatic conditions of the region are such that it is cheaper to build an underground system than to ensure its operation in above-ground reservoirs, the expert says."Due to the limited shipping period on the Northern Sea Route, oil export from this project cannot take place year-round. And in order not to stop production at the fields themselves, it is necessary to accumulate oil in storage before it can be sent by an icebreaker fleet or conventional tankers during the summer navigation window," Alexey Gromov explained.
According to Alexey Gromov, the construction of an underground oil storage facility in the Arctic probably cost the company "many times more than if it had built such a facility in another region of Russia." But without it, production at Vostok Oil would simply have to be frozen for 5-8 months a year.
According to Gromov, Rosneft's "first swallow" will not be the only one – the company plans to create an entire system of such underground oil storage facilities.
At the same time, according to him, Russia needs a strategic oil reserve – a system of underground storage facilities that will not perform operational functions, but will become an element of influence on the global oil market. He noted that in 2020, Russia had to reduce oil production by 10% under the OPEC+ agreement, and it was not possible to return to the previous level. In particular, because many fields that were shut down during the restrictions could not be started up again.
He recalled that today many oil-producing countries, including Saudi Arabia, Kuwait, and the United Arab Emirates, already have their own storage systems in order to influence the situation with global oil supply at the moment when it is needed. And for Russia, the creation of a strategic oil reserve at one time would have been cheaper than the consequences of shutting down fields that are unlikely to be launched in the future.
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