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Gazprom to Start Constructing 17 CNG Filling Stations

Source: www.gulfoilandgas.com 2/21/2013, Location: Asia

The Management Committee took notice of the information about Gazprom's activities aimed at expanding the natural gas use as a motor fuel in Russia. It was mentioned that the NGV fuel market development was of great social importance.

Firstly, it is explained by the ecological advantage of gas over the conventional types of fuel. The motor vehicles conversion from gasoline to natural gas allows reducing harmful emissions roughly fivefold.

Secondly, there is a considerable economic effect: the NGV fuel price is much lower than that of gasoline or diesel fuel. The motor vehicles conversion to gas will reduce road transport costs and, consequently, bring about cost reduction in all economic and social sectors.

Gazprom considers the NGV fuel market development as a profitable core business. The Company is planning to establish a vast natural gas market on its basis.

Gazprom takes sustained efforts in this area. The NGV fuel market development section was included into Cooperation Agreements – basic documents regulating the interaction between Gazprom and Russian regions. The Agreements on Wider Use of Gas as a Motor Fuel were signed with the Kaluga, Nizhny Novgorod, Orel and Tambov Regions. This year similar agreements will be inked with the Governments of Moscow, Saint Petersburg and the Republic of Tatarstan.

Special focus is placed on Eastern Russia. In 2012 seven-year programs for motor transport conversion to NGV fuel were approved for the first time by the executive authorities of the Primorye and Khabarovsk Territories and the Sakhalin Region.

Gazprom keeps building new CNG filling stations. In August 2012 the first CNG filling station was commissioned in the Republic of Altai, in December multi-fuel filling stations opened in Saint Petersburg and in the Samara Region as well as a CNG filling station in the Kurgan Region.

As part of the Russian Regions Gasification Program, the preparations are underway to start building 17 CNG filling stations in 2013. The construction will cover 10 following Russian constituents: the Republic of Tatarstan, the Novgorod, Novosibirsk, Orel, Rostov, Ryazan, Tambov, Vologda Regions, the Perm and Stavropol Territories. Feasibility studies are being developed for 18 investment projects aimed at CNG filling stations construction in the Kaluga, Leningrad, Nizhny Novgorod, Saratov, Volgograd and Voronezh Regions. Another 23 regions are defining possible locations of future CNG filling stations.

The Russian Regions Gasification Program stipulates financial resources to be allocated to investment projects for CNG filling stations construction. In 2013 they will amount to RUB 1 billion.

Gazprom takes efforts aimed at improving the national regulatory framework and legal acts in force that promote the Russian NGV fuel market development. For instance, there is no federal law in Russia providing for a set of measures to boost the conversion of motor vehicles to gas. Creation of such a document is being considered by the Russian Federation Government at Gazprom's initiative.

In order to improve the efficiency of Gazprom's strategy on the NVG fuel market development, a special-purpose company, Gazprom Gazomotornoye Toplivo, was set up. It will consolidate Gazprom's relevant core assets.

Following the meeting results, the Management Committee tasked the specialized structural units to continue the cooperation with state authorities on expanding the use of natural gas as a motor fuel in Russia as well as updating the regulatory framework that promotes the Russian NGV fuel market development.

The specialized structural units were also charged with elaborating and submitting for approval a draft program to expand the use of compressed natural gas as a motor fuel in Gazprom Group's vehicles between 2014 and 2017.

Natural gas use as a motor fuel is rapidly expanding around the world and nowadays involves more than 80 countries. The average annual increase in gas-powered vehicle fleet makes up 26 per cent. The world's leading vehicle producers turn out more than 80 models of gas-powered cars. The Russian fleet of gas-powered vehicles numbers some 90 thousand units, with 4.6 per cent owned by Gazprom.

Nowadays 246 CNG filling stations with the total design capacity of some 2 billion cubic meters of gas a year are operating in 58 Russian regions. Gazprom Group owns 210 Russian CNG filling stations.

According to preliminary data, in 2012 Russian CNG filling stations sold 390 million cubic meters of compressed natural gas, which is 28.4 million cubic meters more than in 2011.

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