Publications

Significant economic and environmental gains can be achieved by applying Best Available Technology in the oil sector in the Arctic

The authors argue that the expectations of LNG glut are not justified

Russia is gradually abolishing oil export levies and hiking its mineral extraction tax, part of the nation's most sweeping oil tax reform project in 20 years

Oil companies in Russia will pay an additional income tax on hydrocarbon production starting in 2019

"American LNG exports have failed to become a full-fledged alternative to Gazprom's pipeline gas in Europe, as the latter has set another record-high last year" Maria Belova, head of research at VYGON Consulting, told RT.

Moscow-based Vygon Consulting says out­put from Russia’s largest fields is falling and that increased drilling activity and other intensification measures can cover only 90% of this natural decline.

The Russian energy sector is hoping that new legislation is adopted this year to facilitate the use of blockchain technology, which could cut producers' operational costs by 3-5%. While there are already some successful pilot projects involving blockchain in logistics, introducing blockchain to trading is contingent on new legislation that will cover Russia's digital economy and may be passed later this year.

The article by M. Belova and E. Kolbikova analyzes the competitiveness of US LNG exports, considering a range of factors including the structure and special features of US LNG export contracts, LNG plants capacity outlook, as well as relation between cost of supply and import prices in Europe, the Asia-Pacific region and Latin America.

The article of Head of research VYGON Consulting Maria Belova for BLUE FUEL (Gazprom Export Global Newsletter, December 2017 / Vol. 10-11/ Issue 4-5)

Vygon Consulting said in a presentation to reporters that oil exports this year are seen declining by 0.7 percent to 252.5 million tonnes (5.1 million barrels per day) from around 255 million tonnes in 2016, a record high.

Russia's refining sector has seen a pick-up in the first half of the year compared with the dire state it was in a year ago, and expectations are that the rest of the year will continue to show stronger economics, although estimates of processing volume dynamics and margins diverge.

Russia's crude refining sector is expected to see further pressure in the coming year with oil export duty changes coming into force in January in a move likely to extend the recent downward trend in the country's refining throughput and free more barrels for exports.

Grigory Vygon, Managing Director of VYGON Consulting, on the impact of low oil prices on Russian oil and gas producers and their prospects on the European market.

The European market makes up for about two-thirds of Gazprom’s gas turnover. Some 159 billion cubic meters (bcm) were delivered in 2015 an 8% growth compared to 2014. Sales of this quantity generate around half of Gazprom’s revenues coming from hydrocarbons industry.

A new study shows that the amount of fuel sold at the pump was down by 1.3 percent in 2015, with the decrease predicted to be even greater in 2016-2017 due to the economic crisis.

Russia’s refineries are staring into the abyss of another dark year, with low oil prices and taxes whittling down margins to a level even lower than last year’s. Large, modernized operations will manage to eke out a profit, or at least break even, thanks to value-added products, while the plethora of heavy fuel oil-reliant teapots will come under greater economic strain, with some possibly folding.

In terms of economics, analysts say the project could work given Afipsk’s export logistics and the current tax maneuver, which foresees a steady reduction in duties for exported lighter oil products. “The refinery has an advantageous geographic location, and thanks to the current export duties it enjoys a good margin,” said Sergei Yezhov, chief economist at Vygon Consulting in Moscow. “They can build the terminal and recoup the investments while the [export] subsidies are in place,” he added, though this would require a firm belief that the current tax regime will not undergo drastic changes. The past, however, has shown that taxes change often and dramatically in Russia.

Today, Russia's largest gas company faces a number of problems. “Internal demand for Gazprom gas is rapidly falling. Sales on the domestic market have plummeted by 30 percent: from 307 bcm in 2005 to 217 bcm last year. What tights the situation more is the two main competitors, conducting aggressive market expansion – the largest private company Novatek – the second-largest player at the market, and the state company Rosneft"

Moscow and Brussels have switched their gas business from the model of "interpenetration and interdependence" to the model of "pure diversification".