Gazprom summed up the work results in 2023

Stocks

For December 31, 2023 in the territory of Russia reserves of hydrocarbons of Gazprom Group of the categories A+B1+C1 made 27.75 trillion CBM of natural gas, 1.24 billion tons of gas condensate and 1.75 billion tons of oil. Including stocks of the organizations investments in which are classified as joint operations, there are 268.8 billion cubic meters of gas, 3.1 million tons of condensate and 3.7 million tons of oil in the share falling on Gazprom Group. The total volume of reserves of hydrocarbons of Gazprom Group of the categories A+B1+C1 corresponds 203.07 billion barrels of oil equivalent. Nearly a half (47%) of explored reserves of natural gas of Gazprom Group settles down in actively developing new regions of gas production and also on the fields providing stable production in well studied Nadym-Pur-Taz region and the European part of the country. On the fields located on the shelf of the Russian Federation there are 29% of explored reserves of natural gas.

Reserves of hydrocarbons of the categories A+B1+C1 of the associated organizations and joint ventures in the share falling on Gazprom Group made for December 31, 2023 1.66 trillion CBM of natural gas, 153.6 million tons of gas condensate and 751.9 million tons of oil.

Geological exploration

Last year, 3D seismic exploration was carried out in Russia in the volume of 2.8 thousand square kilometers, exploration drilling penetrated 140.3 thousand meters of rock, 29 oil and gas wells were completed, and 23 wells flowed during testing.

At the end of 2023, the growth of hydrocarbon reserves in Russia in categories A+B1+C1 as a result of geological exploration work (GER) made 411.6 billion cubic meters of natural gas, 24.4 million tons of gas condensate and 63.4 million tons of oil. The most essential gain of reserves of gas is received on the Malyginsky field on the Yamal Peninsula, on the Kovykta field in the Irkutsk region, on a 75 years of the Victory field on the shelf of the Kara Sea, and also on the Verkhnevilyuchansky and Tas-Yuryakhsky fields which are satellites of the Chayandinsky oil-gas condensate field (OGCF) in new Yakutsk the center of gas production.

High level of the GER organization allows Gazprom to maintain the low level of cost of investigation. Without the organizations investments in which are classified as joint operations, 89.4 billion rubles are directed on production of GER in 2023 (with the VAT), average costs of completion of explored reserves of hydrocarbons made 26.8 rubles for 1 barrels of oil equivalent, efficiency of GER – 23.8 thousand barrels of oil equivalent on 1 meter of penetration.

GER executed last year provided completion of stocks. Fields of V.P. Orlov in the Orenburg region and Taltymskoye in Khanty-Mansi Autonomous Area, and also 21 new deposits on earlier opened fields were discovered.

Production

In 2023 production of natural and associated gas of Gazprom Group in the territory of the Russian Federation made 358.95 billion cubic meters. Volumes of production and their distribution between the operating centers of gas production are defined by the company proceeding from need of ensuring reliable supply of gas to the Russian consumers, and also implementation of export obligations with the arriving demands for additional volumes.

In 2023 production of natural and associated gas within implementation of projects of development of deposits of hydrocarbons on Han Yakhinsk and the Pestsovy OGCF (valanzhin), and also oil pools of the West Tarkosalinsky OGCF was increased. Arrangement of the Semakovsky gas field which development began in December, 2022 within joint activity with the Russian partner of Gazprom Group was continued — on a field arrangement of the second turn is begun, drilling of operational wells was conducted.

Last year, the level of useful utilization of associated petroleum gas at Gazprom Group fields in Russia was 94.7%. Actions for increase of use of associated oil gas — construction new and reconstruction of the objects which are in operation on its preparation, transportation, processing, and also objects on development warm and the electric power were realized.

Last year the Group in the territory of the Russian Federation extracted 72.38 million tons of oil and gas condensate, by the associated organizations and joint ventures – 17.18 million tons. Modern methods of increase of oil recovery are one of the main instruments of maintenance and strengthening of production on mature fields, and also development of «difficult» oil.

Transportation and storage

As of December 31, 2023 the extent of the main gas pipelines (MGP) and gas pipeline branches operated by gas transmission societies of Gazprom Group in the territory of the Russian Federation reached 180.6 thousand km. Last year 564.25 billion cubic meters of gas came to the gas transmission system (GTS) of Gazprom in the territory of Russia. PAO Gazprom, being the owner of GTS, according to the legislation provided non-discriminatory access to the gas pipelines in 2023 to 18 independent companies which are not entering into Group and having the license for gas production, and also the contract with the buyer of their volumes.

Together with gas transmission and gas societies of Gazprom the underground gas storages (UGS) optimize productions, reducing the volume of capital and operational expenditure, providing the optimum modes of operation of processing equipment. Objects of UGS smooth any types of uneven demand on gas — seasonal, week, daily, providing in a heating season from 20 to 40% of all supply of gas PAO Gazprom. UGS reliably provide consumers with natural gas irrespective of a season, fluctuations of temperature, unforeseen circumstances, making the contribution to energy security of Russia. The role of gas storages also in creation of strategic reserves of gas in situations of export transit risks is irreplaceable.

In 2023 in the territory of Russia Gazprom operated 23 UGS created in 27 geological structures: 17 — in the exhausted gas fields, eight — in water-bearing layers and two — in deposits of rock salt. Last year from UGS of Russia 39.3 billion cubic meters of gas were withdrawn, 37.9 billion cubic meters of gas were downloaded. By the beginning of the 2023/2024 withdrawal season PJSC Gazprom reached the set record level of the operational gas reserve in UGS facilities in Russia — 72.84 billion cubic meters, and the potential maximum daily capacity of Russian UGS facilities reached the level of 858.8 million cubic meters.

Processing

By the beginning of the 2023/2024 withdrawal season PJSC Gazprom reached the set record level of the operational gas reserve in UGS facilities in Russia — 72.84 billion cubic meters, and the potential maximum daily capacity of Russian UGS facilities reached the level of 858.8 million cubic meters.

Last year Gazprom made 6.27 million cubic meters of helium that is 70% more than in 2022.

Power

Gazprom Group has created Russia’s largest vertically integrated electric power holding company that combines assets in electric and thermal power generation, heat transmission and sales, as well as assets in related segments, such as power engineering, repair and maintenance services of the machine-building complex — Gazprom Energoholding.

Last year, the Group produced 153.67 billion kWh of electricity and 142.56 million Gcal of heat. Gazprom Energoholding’s fuel basket shows an increase in natural gas and coal consumption, which is due to an increase in the share of condensing power units’ utilization in total electricity generation at the initiative of JSC System Operator.

Gas distribution and gasification

Activity in the field of gas distribution is conducted by JSC Gazprom Gas Distribution, its affiliated and dependent societies, and also JSC Gazprom Transgaz Kazan. As of December 31, 2023 in property and service of the specified organizations in the territory of Russia there were 900.8 thousand km of gas-distributing networks on which last year 241,7 billion cubic meters of gas were transported. Were provided with natural gas: 29.2 million apartments and private households; 38.7 thousand industrial facilities; 9.4 thousand agricultural objects; 378 thousand household objects.

Gas supply and gasification of regions of Russia are the large-scale social project of Gazprom Group. JSC Gazprom Gasification (subsidiary of Gazprom Mezhregiongaz Group) — the Uniform operator of gasification — the center of responsibility for development of gasification of territories of Russia (construction of gas pipeline branches, gas-distributing stations (GDS), inter-settlement gas pipelines, distributive networks in borders of settlements and gas pipelines of «the last mile» to border of the land plot).
In 2023 construction of 195 inter-settlement gas pipelines 2447 km long that created conditions for gasification more than 50.6 thousand households and apartments, and also 336 boiler rooms in 412 settlements was complete.

It was put into operation 124 inter-settlement gas pipelines by Gazprom Mezhregiongaz group. In addition, Gazprom Mezhregiongaz Group completed construction and obtained a permit for commissioning under load for eight gas distribution stations with a total length of 141 km of gas pipelines and branches. In addition, construction of gas pipelines and gas distribution stations continued under the Gazprom Investment Program for gasification and gas supply of the regions. 10 GDSs with gas pipelines with a total length of 319 km were commissioned
The Unified Gasification Operator, regional operators and independent gas distribution organizations (GDOs) have cumulatively concluded 1,091,000 contracts with individuals since the beginning of gasification activities.

Russian market

Last year, total gas consumption in Russia amounted to 495.6 billion cubic meters, which is 1.8% above the 2022 level. This increase is due to colder weather conditions in the fourth quarter of 2023 with a corresponding increase in gas withdrawals by the power industry against the backdrop of a growing domestic economy.

The main consumers of natural gas in Russia are electricity and heat producers (34%), oil industry (12%), households (11%), utilities (8%), metallurgy (6%), gas industry (5%) and agrochemical industry (5%).

Gas motor fuel

Gazprom carries out large-scale complex work on expansion of use of natural gas as motor fuel, actively participates in development of the gas engine market of Russia.

JSC Gazprom Gas Motor Fuel determined by the uniform operator by development of the market of gas motor fuel is engaged in realization of gas as motor fuel and development of retail network of automobile gas-filling compressor stations (CNG filling station) under brands Gazprom and EcoGas.

As of December 31, 2023, Gazprom Group organizations and Gazprom Gazomotornoye Toplivo had 464 CNG filling stations with a total annual capacity of 3.3 billion cubic meters. Last year, 452 facilities commercialized and shipped compressed natural gas (CNG).

Another 22 third-party CNG filling stations under franchise agreements were also engaged in production activities.

The volume of realization of compressed natural gas by the organizations of Gazprom Group and JSC Gazprom Gas Motor Fuel through own network of the CNG filling station in the territory of Russia in 2023 made 919 million cubic meters, including partner objects — 1 billion cubic meters that makes 71% of total sales of gas motor fuel in the country.
As of December 31, 2023, the quantity of gas engine motor transport of the companies of Gazprom Group made 14 693 units. The share of equipment of gas engine transport from quantity of the fleet of vehicles suitable for conversion makes 63%.

Gazprom» closely cooperates with the largest Russian car makers on expansion of a line of natural gas vehicles, including for own needs. Serial release more than 230 models of cars, buses and equipment of a special purpose on natural gas is adjusted. Russia’s first liquefied natural gas (LNG)-powered shunting locomotive TEMG1 was developed at the request of PJSC Gazprom. Work is underway to create models of LNG-powered passenger ships for use in the waters of St. Petersburg.

Average and low-tonnage LNG

The medium-tonnage Complex on production, storage and shipment of the liquefied natural gas around compressed station Port works at the Northwest of Russia since September, 2022. Design productivity of the complex is 1.5 million tons a year. Last year this complex made 1.39 million tons of LNG.

The Gazprom group conducts system work on development of production and use of low-tonnage LNG in Russia, including for autonomous gasification of settlements, considerably remote from gas pipelines. Last year the production infrastructure of low-tonnage LNG of Gazprom Group consisting in 2022 of six LNG complexes (in the Kaliningrad, Leningrad, Moscow areas, in Sverdlovsk region in the cities of Yekaterinburg and Pervouralsk, in Perm Krai) and one installation of liquefaction of natural gas in Vladivostok, extended due to input of two new objects with a productivity of 12.6 thousand tons a year everyone — in the Svobodnensky region of the Amur region and in the Volgograd region. Besides, in 2023 installation and construction works on projects Konakovo LNG (productivity — 6 thousand tons a year) and Tobolsk were completed (42 thousand tons a year).

International market

According to preliminary estimates, in 2023 consumption of gas in the world increased by 15 billion cubic meters (+0.3%). Thus weather conditions became a factor of control of a gain of consumption: last year became the warmest for all history of observations. Negative influence on world power, first of all on the gas market, geopolitical factors, prevalence of politically motivated decisions in power policy of a number of the countries, high risks in the field of energy security and price volatility remains.

Fossil types of fuel will remain a basis of world power balance in the long term; increase of a role of natural gas in a world energy balance at any realistic scenario of development of power is predicted. For emerging markets natural gas remains the most attractive energy resource thanks to a combination of reliability, convenience of use, profitability and ecological advantages, and also stability and reliability of the power systems which are based on consumption of natural gas within long-term contract relationship.

The most essential increase in demand for gas was recorded in the Pacific Rim (PR). According to preliminary estimates PAO Gazprom, in 2023 consumption of gas in Asia-Pacific countries grew almost by 30 billion cubic meters (+3%). China became the engine of growth of consumption of gas.

Last year supply of gas PAO «Gazprom» according to demands of the Chinese party repeatedly exceeded daily contract volumes. PAO Gazprom provided a half of a gain of import of gas to the People’s Republic of China following the results of 2023. Russian gas plays an important role in ensuring stability of gas supply of China, especially during the winter period. In 2023 export on the Power of Siberia gas pipeline grew by one and a half times and made 22.7 billion cubic meters.

Central Asia

According to preliminary estimates, in 2023 consumption of natural gas in the countries of Central Asia made more than 110 billion cubic meters, and the volume of commodity gas production exceeded 150 billion cubic meters, about a third of this volume is exported. At the same time an imbalance between volumes of production and consumption of gas, and also uneven demand stimulate increase in import of gas by some countries of the region.

Kazakhstan’s energy complex is currently in need of additional power generating capacity. According to the plan of measures developed by the Ministry of Energy of the country on development of electrical power branch, the increase in gas generation has to become one of bases of elimination of deficiency of electric power. Supply of natural gas from Russia will allow not only to resolve issues with fuel supply of perspective gas power plants, but also to transfer from coal on gas the operating stations in the future.

Consumption of gas in Uzbekistan after the long period of a steady growth started being reduced forcedly because of decrease in production in recent years. In 2023 the country became a net importer of natural gas. Deliveries of PAO Gazprom to the region in the long term will promote dynamic development of economies of the countries of Central Asia.

Europe

For many years the European power policy was directed on large-scale support of development of renewables and the accelerated refusal of fossil types of fuel. Besides, in 2022 in a number of the European countries decisions on refusal of import of the Russian pipeline gas were made. The followed increase in prices for gas caused falling of its consumption in all sectors of economy. In many countries decrease in industrial production and closing of the enterprises of power-intensive branches were observed.

In 2023, despite prices dropping from record levels in 2022, the drop in gas demand in Europe continues. As a result consumption of gas in the European foreign countries was reduced by 35 billion cubic meters (-6.9%) and made 472 billion cubic meters. Thus, over the last two years, the cumulative decline in gas demand has exceeded 100 billion cubic meters. Gas consumption in Europe fell to an almost 30-year low

At the same time with decrease in demand for gas falling of own production which, following the results of 2023, decreased by 18 billion cubic meters proceeds. Thus production at the main producer — Norway — was reduced by 7.5 billion cubic meters that is caused by technical difficulties and emergency stops because of gas increase in production in the previous year. Against the backdrop of a depleting resource base, the region is not expected to increase its own production in the future. Thus, Europe is becoming more and more dependent on the volatile LNG market, which significantly increases the risks to energy security and economic stability, especially during the winter months.

Prospects

In 2023, the world’s energy policymaking priorities began to change: from disproportionate support of renewable power to unconditional ensuring energy security. This tendency testifies that fossil types of fuel will remain a basis of world power balance in the long term, despite preservation of essential risks of energy security and high level of uncertainty of development of the world energy markets. Thus the role of natural gas will continue to grow in a world energy balance at any realistic scenario of development of power.

The power systems which are based on consumption of natural gas on the basis of long-term contract relationship proved the stability in the long term that is especially valuable in the conditions of turbulence in the world energy markets.

In the Asian market the stable growth of volumes of consumption of energy resources, especially natural gas is predicted. The key role in increase in energy consumption, including gas consumption, will be played by China. The volume of the Chinese market of natural gas already now exceeds cumulative gas consumption all countries of the European Union (EU). The share of China in a world gain of consumption of gas in the next 20 years can make more than 30%. High growth rate of demand for gas in China will be provided by the industry and sector of housing and communal services, including in connection with gasification of new areas and continuation of campaign for the translation of consumers from coal on gas. Essential value will also have increase in capacities of gas generation within the solution of a task of decrease in emissions of greenhouse gases and expansion of use of natural gas as motor fuel. The predicted growth of consumption of gas in China will be followed by further increase in volumes of its import.

For Europe the long-term forecast of consumption of natural gas differs in the highest degree of uncertainty and assumes gradual decrease in demand which rates depend on further steps of the leaders of EU countries in the field of power policy and volume of financial resources which it is ready to allocate for economically unprofitable refusal of natural gas.
In the long term the expansion of merger of BRICS which took place in August, 2023 can have considerable impact on the structure of the world energy markets. When the new members formally join the association, BRICS (or BRICS+) will represent countries that account for nearly half of the world’s population and account for about one-third of the world’s gross domestic product. In the long term the countries of association will be able to solve the most important problem of ensuring energy security in the BRIKS+ block which includes now as large producers of energy resources (Russia, Saudi Arabia, Iran), and consumers (China, India).

REFERENCE: In 2023 gas was brought to 412 settlements. Level of gasification of Russia reached 73.8%. It makes 89% of technically feasible network gasification of the country, and by 2030 the indicator will be brought to 100%. Within additional gasification Gazprom builds gas networks free of charge for citizens to the boundaries of house plots. Following the results of 2021-2023 874 thousand Russian families had an opportunity to pass to the most economic and eco-friendly fuel, to increase considerably quality of life. Taking into account great social value the program of additional gasification extends. Since March, 2023 it included boiler rooms of medical and educational institutions, since April, 2024 — houses in gardening associations. The Amursk gas processing plant, one of the world’s largest, had three process lines in commercial operation by the end of last year. Three process lines were in commercial operation at the Amur gas processing plant, for a total of six lines. The list of production of the enterprise includes helium — the noble gas demanded in Russia and abroad, irreplaceable for high-tech industries. After an exit at full capacity the Amursk gas processing plant will become the world leader in production of helium. One more complex Gazprom creates in the Northwest of Russia. On gas processing volume it will become the largest enterprise in the country and one of the most powerful in the world. It is important that the large-capacity plant on liquefaction of natural gas also will be its part.
Activity of Gazprom Group is not limited to the solution of production tasks. In regions of presence Gazprom improves territories, creates sports infrastructure and helps preservation of cultural, historical and spiritual heritage. For example, during implementation of the Gazprom — to Children project in Russia it is constructed more than 2.1 thousand modern sporting and social venues. Of these, 116 facilities were commissioned, including the largest in the history of the project — the Academy of Martial Arts on the federal territory of Sirius.

Victor Zubkov, Chairman of the Board of Directors of PAO Gazprom
Alexey Miller, Chairman of the Board of PAO Gazprom