Russian plans to divert up to 25-45 billion cubic meters of gas from its Shtokman field to Europe and away from the US could be bad news for US companies Chevron and ConocoPhillips.
The Shtokman field has a planned output of 70bcm a year. With plans to divert up to half of it to Europe, Russia's current gas supplies to Europe get a 15 to 30 percent boost.
Previously Russian gas monopoly Gazprom had said that it wanted to grab 10 percent of the US market by 2010 by liquefying almost all of the gas for shipment to the US.
Shtokman has gas reserves of around 3.7 trillion cubic feet and is a challenging project due to its offshore, out of helicopter range, location. Gazprom has shortlisted 5 companies including Chevron, ConocoPhillips and Total to help it develop the field.
If Gazprom is planning to focus on Europe as the key market for Shtokman's gas, then the European companies on the shortlist such as Total, Statoil and Norsk Hydro would have better chance of being part of the project. ConocoPhillips and Chevron may be left out as Gazprom has said that in the final line-up it will only take 2 or 3 partners on for the $20 billion project.
Gazprom has repeatedly put off announcing its choice of partners. Russia is using the bidding process for partnership in the
Shtokman project as a bargaining chip to become part of the World Trade Organization. If Russia does not succeed in this, the chances that Shtokman will have European partners are high.
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