GAS EXPORT AND ENHANCING RELIABILITY OF GAS SUPPLY TO EUROPE Press Conference, May 31, 216
GAS SALES BY GAZPROM GROUP bln m 3 Volume and average price data for Gazprom Group s gas in countries beyond former Soviet Union* Net revenue** from gas sales in countries beyond FSU RUB bln 2 15 1 5 25 2 15 1 5 167.6 148.3 148.1 156.6 151. 1,125 9,414 9,167 174.3 159.4 184.4 11,259 11,97 12,138 13,487 15,57 28 29 21 211 212 213 214 215 1,261 1,15 1,99 1,439 1,469 1,683 1,752 RUB/1, m 3 2,166 bln m 3 RUB bln Volume and average price data for Gazprom Group s gas in CIS and Baltic States 1 75 5 25 Net revenue** from gas sales in CIS and Baltic States 75 5 25 96.5 3,957 357 56.7 31 7.2 6,411 7,39 45 81.7 637 66.1 53 59.4 8,59 9,49 8,5 48.1 4.3 1,116 11,911 28 29 21 211 212 213 214 215 42 412 43 RUB/1, m 3 28 29 21 211 212 213 214 215 28 29 21 211 212 213 214 215 2 * Gas supplies, incl. LNG, to foreign countries except for CIS and Baltic States under contracts of Gazprom Export and other Gazprom companies. ** Net of customs duties.
GAS SALES BEYOND FSU UNDER CONTRACTS OF GAZPROM EXPORT bln m 3 Sales under contracts of Gazprom Export in 215 totaled 158.6 bln m 3 Net revenue from gas sales beyond FSU reached RUB 2.2 trln in 215 Germany, Turkey, and Italy were major gas buyers in 215 Germany (45.3) Turkey (27.) Poland (8.9) France (9.7) United Kingdom (11.1) Italy (24.4) 3
215 RESULTS BY COUNTRIES: CIS AND BALTIC STATES* bln m 3 Gas sales in CIS and Baltic States in 215 totaled 4.3 bln m 3 Net revenue from gas sales in CIS and Baltic States amounted to RUB 43 bln in 215 Belarus (18.4) Ukraine (7.8) Kazakhstan (4.7) 4 * According to financial statements under IFRS
LEADING ROLE OF GAZPROM GROUP S GAS IN EUROPEAN MARKET Gazprom s* share in European gas consumption Gazprom s* share in European gas imports** 5 9 8 7 6 5 4 3 2 1 2 15 1 5 26% 26% 27% 25% 23% 27% 26% 3% 3% 31% 583.6 582.8 597.5 563.6 62. 551.3 542.5 54.4 485.7 55.9 151.1 179. Gazprom Group 15.5 125.2 Norway 158.8 48.9 44.6 37.6 28.2 Netherlands 14.6 138.6 Gas supplies to Europe by major exporters and producers in Short-term forecasts for gas consumption from leading 215 (excluding Baltic States), bln m 3 global companies (consumption 28 = 1%) United Kingdom 15. Algeria 138.8 Qatar 161.5 * Gas sales under contracts of Gazprom Export ** Difference between consumption and domestic production 8.7 7.8 Iran 146.6 Nigeria 158.6 26 27 28 29 21 211 212 213 214 215 5 4 3 2 1 1 % 95 89 84 78 58% 56% 58% 55% 48% 57% 55% 63% 67% 65% 258.9 27.9 272.9 256.8 29.7 262.1 252.3 257.6 151.1 15.5 158.8 1. 14.6 Actual 26-15 CERA (November 214) CERA (March 216) PIRA (July 215) PIRA (April 216) 138.6 15. 138.8 9.1 161.5 81. 85.5 219.2 242.1 146.6 158.6 26 27 28 29 21 211 212 213 214 215 9.4 92.6 88. 85.2 85.4 85.4 26 28 21 212 214 216 218
INCREASING GAP BETWEEN CONSUMPTION AND DOMESTIC PRODUCTION IN EUROPE 8 7 6 According to consensus forecast, Europe s demand for extra gas imports versus 215 will be nearly 113 bln m 3 in 225 and 15 bln m 3 in 235 bln m 3 5 4 3 2 1 21 211 212 213 214 215 216 217 218 219 22 221 222 223 224 225 226 227 228 229 23 231 232 233 234 235 Диапазон Production прогнозов forecast range добычи Production Консенсус-прогноз consensus добычи forecast Consumption Диапазон прогнозов forecast range потребления Консенсус-прогноз Consumption consensus потребления forecast Source: forecasts by top consulting and analytical companies as well as leaders of petroleum industry 6
DECLINING ATTRACTIVENESS OF U.S. LNG SUPPLIES TO EUROPE Estimated price range* for U.S. LNG supplies to Europe versus forward prices** in European gas market 4 USD/1, m 3 USD/MBTU 35 1 Forward contract prices in Europe are compromising commercial attractiveness of future LNG supplies linked to Henry Hub prices 3 25 2 15 1 5 Price range for American LNG in Europe Price range for American LNG in Europe excl. tolling fees NBP prices (forward curve) 8 6 4 2 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Jul-19 Jan-2 Jul-2 Jan-21 Jul-21 Jan-22 Jul-22 * Based on Henry Hub forward prices, P = HH * 115% + X, where X costs (liquefaction, shipments, regasification) ** NBP forward prices Sources: Bloomberg, Wood Mackenzie 7
Power industry shows greatest growth in gas consumption across Europe. Even EC s most radical ecology-oriented scenario, with highest subsidies for RES, envisages increased gas use for power generation. According to baseline scenario, by 225 gas-fired power generation in EU will grow by one-third versus 215. 8 FORECASTED GROWTH IN GAS-FIRED POWER GENERATION 4 TWh 35 Baseline scenario* 23 Energy Strategy scenario** 4 35 TWh 855 847 844 841 838 834 831 828 825 821 818 815 812 88 85 82 799 26 823 438 317 831 473 347 87 489 377 784 55 47 76 521 437 736 537 468 713 554 498 689 57 528 665 586 558 642 62 588 618 618 619 595 634 649 571 65 679 547 666 79 524 682 739 5 698 769 476 714 3 25 2 15 1 5 214 216 218 22 222 224 226 228 23 214 216 218 22 222 224 226 228 23 855 847 841 834 827 82 814 87 8 793 786 78 773 766 759 753 746 33.6% 33.3% 26 823 438 317 831 473 353 81 476 389 771 478 425 74 481 462 71 484 498 68 487 534 65 489 57 62 492 67 589 495 643 559 497 679 529 5 715 499 53 752 469 55 788 438 58 824 48 511 86 378 513 3 25 2 15 1 5 Oil Gas Coal Wind 4.1% 26.4% Solar and tidal energy, etc. Biomass Hydro Nuclear * 21% increase in energy efficiency by 23, 33% reduction of greenhouse gas emissions by 23 versus 199, 24.4% share of RES in primary energy consumption by 23. ** 27% increase in energy efficiency by 23, 4% reduction of greenhouse gas emissions by 23 versus 199, 27% share of RES in primary energy consumption by 23. Source: European Commission, ENTSO-E
GAZPROM IN INTERNATIONAL NGV MARKETS Gazprom Group s filling stations in Europe Gas sales through Gazprom s filling stations 6 5 4 3 2 1 212 213 214 215 Poland Польша Czech Чехия Republic Germany Германия mln m 3 Poland Czech Republic Germany Gazprom intends to expand its presence in international NGV markets through: Gazprom is developing logistics infrastructure in order to establish itself in international NGV markets further developing CNG and cryogenic gas filling network; increasing small-scale LNG supplies to international markets; boosting NGV business beyond Europe if Gazprom implements international production projects with a view to commercialize gas produced abroad. construction of small-scale LNG terminal is underway in port of Rostock; Gazprom entered into Framework Agreements with Nederlandse Gasunie (Netherlands) and Fluxys (Belgium) to expand small-scale LNG infrastructure. 9
UNDERGROUND GAS STORAGE: ENSURING STABLE, RELIABLE, AND FLEXIBLE SUPPLIES 215: development of Europe s underground gas storage system British UGS facilities Bergermeer Katharina Damborice Haidach Banatski Dvor During 215/216 withdrawal season, Gazprom operated 5. bln m 3 of gas storage capacities in Europe. Maximum daily deliverability of UGS facilities in Western Europe was 61.5 mln m 3 during 215/216 withdrawal season. Construction is currently in progress at Katharina and Damborice UGS facilities: Katharina UGS project is on track (4 caverns are functioning; working gas capacity is 219 mln m 3 ); construction of Damborice UGS facility with design working gas capacity of 456 mln m 3 is nearing completion in Czech Republic. 1
NORD STREAM 2 Nord Stream 2 project envisages construction of gas pipeline across Baltic Sea with entry point in Kingisepp District of Leningrad Region and exit point near Greifswald in Germany Length of gas pipeline around 1,2 km Annual capacity 55 bln m 3 of gas In addition to higher reliability of supplies, Nord Stream 2 project is consistent with EU objectives for energy security and harmful emissions reduction Nord Stream 2 AG project company was set up for project implementation Project partners 11
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