Gazprom and RusGazDobycha agree Ust-Luga LNG project implementation

Gazprom and RusGazDobycha agree Ust-Luga LNG project implementationImage courtesy of Gazprom

Gazprom and RusGazDobycha have moved to the implementation stage of the Ust-Luga LNG project following the decision on the final configuration of the project.

The project envisages the construction of capacities for the processing of 45 billion cubic meters of gas and for the production and shipping of 13 million tons of LNG, up to 4 million tons of ethane and over 2.2 million tons of liquefied petroleum gases (LPG) per year.

The complex will be processing ethane-containing gas produced by Gazprom from the Achimov and Valanginian deposits of the Nadym-Pur-Taz region, Gazprom said

The gas remaining after the processing (about 20 billion cubic meters) will go into the company’s gas transmission system.

It is expected to put the first train of the complex into operation in the second half of 2023 and the second train in late 2024.

The project operator is RusKhimAlyans, a company established on a parity basis by Gazprom and RusGazDobycha.

The operator’s priorities include the development of basic and detailed design documentation and the launch of land planning activities at the leased site of the future complex in the southern part of the Ust-Luga port (1,400 hectares). It is also planned to devise contracting arrangements within the project, designate EPC contractors, and place orders for long lead items.

The investment in the project is expected to exceed 700 billion Russian rubles ($10.66 billion).

The plant will make it possible to increase Russian LNG exports and to take LPG exports up by 30–40 percent.

The production of ethane, which is in high demand in the domestic industry, will also grow substantially. The ethane produced at the plant is to be supplied to a high-potential gas chemical facility whose construction is to be independently sponsored by RusGazDobycha (through a special-purpose entity, Baltic Chemical Complex). The estimated capacity of the future gas chemical facility is over 3 million tons of polymers per year.

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