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Gazprom Board to consider implementation of Shtokman project on June 18

The start of the Shtokman field development was postponed several times due to the changes in the parameters of the project

MOSCOW, June 10 (Itar-Tass) - The Board of Directors of Russia’s gas giant Gazprom will convene on June 18 to consider the implementation of the project aimed at the development of the Shtokman gas condensate field, the company said in a statement made public on Monday. The participants in the meeting will also discuss fulfilment of Gazprom’s Eastern Gas Program.

At the end of May 2013, Gazprom Deputy Board Chairman Andrei Kruglov said that the company might postpone developing the Shtokman gas condensate field “for future generations” and, instead of this, to start developing the Yuzhno-Kirinskoye field in the Sakhalin Islands offshore zone. One of the reasons for making such a decision may be the closeness of the Yuzhno-Kirinskoye field to the markets of Asia-Pacific Region.

The start of the Shtokman field development was postponed several times due to the changes in the parameters of the project, which are necessary for the adoption of the final investment decision. In summer 2012, the first stage shareholder agreement expired, while the new document was not signed so far. Although the new agreement on the development of the Shtokman gas condensate field was expected to be signed by the beginning of autumn.

The old shareholder agreement - with the participation of Norway’s Statoil and France’s Total - expired on July 1, 2012. The new shareholder agreement should take into account changes in the field development technologies, which envisages almost 100-percent production of liquefied natural gas in the format of the first stage of the project.

In March 2013, Russia’s Gazprom and France’s Total reached accord on the drafting of a “roadmap” with the aim to sign a new agreement on the fulfilment of the project.

The Shtokman gas condensate field is located in the central part of the offshore zone within the Russian sector of the Barents Sea. Now, the Shtokman field is considered as one of the biggest in the world over the explored gas reserves. The field’s geological reserves are estimated at 3.9 trillion cubic metres of gas and about 56 million tonnes of gas condensate.

The program of the Shtokman field development envisages a full cycle of the development, from geological surveys through to processing and transportation, and includes three stages.

The first stage of the project envisions production of 23.7 billion cubic metres of natural gas a year.

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