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Gazprom vs. other Russian gas producers: The evolution of the Russian gas sector

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  • Lunden, Lars Petter
  • Fjaertoft, Daniel
  • Overland, Indra
  • Prachakova, Alesia

Abstract

The non-Gazprom gas producers (NGPs) doubled their share of the Russian domestic gas market between 2000 and 2010 and have continued growing since then. For several years especially Novatek expanded. More recently, Rosneft has emerged as a key player, not least through its purchase of TNK-BP. This article begins with an overview of the companies in the Russian gas sector, their resource bases and capacities, and subsequently examines whether differences in field development costs and export market access may make it rational for Gazprom to continue ceding market share to the NGPs. With rising costs of Gazprom's queue of greenfield developments, any delays in Gazprom's investment program may be compensated through increased NGP production. The article argues that the NGPs are ready to fill the gap, may be allowed to do so and are already increasing their market share in an increasingly competitive market. The stage may now be set for a continued gradual transformation of the Russian gas market, in which the interests of Gazprom and the NGPs may be complementary or may be pitted against each other, but those of the Russian Federation are in any case likely to be better fulfilled than in the past.

Suggested Citation

  • Lunden, Lars Petter & Fjaertoft, Daniel & Overland, Indra & Prachakova, Alesia, 2013. "Gazprom vs. other Russian gas producers: The evolution of the Russian gas sector," Energy Policy, Elsevier, vol. 61(C), pages 663-670.
    • Handle: RePEc:eee:enepol:v:61:y:2013:i:c:p:663-670
    DOI: 10.1016/j.enpol.2013.06.055
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    References listed on IDEAS

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    1. David G. Tarr & Peter D. Thomson, 2017. "The Merits of Dual Pricing of Russian Natural Gas," World Scientific Book Chapters, in: Trade Policies for Development and Transition, chapter 14, pages 315-336, World Scientific Publishing Co. Pte. Ltd..
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    Cited by:

    1. Costin Radu Boldea & Bogdan Ion Boldea & Tiberiu Iancu, 2023. "The Pandemic Waves’ Impact on the Crude Oil Price and the Rise of Consumer Price Index: Case Study for Six European Countries," Sustainability, MDPI, vol. 15(8), pages 1-15, April.
    2. Catherine Locatelli, 2020. "Une lecture institutionnaliste de la réforme du secteur gazier russe," Working Papers hal-02734835, HAL.
    3. Sadek Boussena & Catherine Locatelli, 2016. "Guerre des prix ou instrumentalisation de l'incertitude sur les prix : quelle stratégie pour un fournisseur dominant sur le marché gazier européen ?," Working Papers hal-01284518, HAL.
    4. Sadek Boussena & Catherine Locatelli, 2017. "Gazprom and the complexity of the EU gas market: a strategy to define," Post-Print hal-01618494, HAL.
    5. Boussena, S. & Locatelli, C., 2017. "Gazprom and the complexity of the EU gas market: A strategy to define," Working Papers 2017-09, Grenoble Applied Economics Laboratory (GAEL).
    6. Talipova, Aminam & Parsegov, Sergei G. & Tukpetov, Pavel, 2019. "Russian gas exchange: A new indicator of market efficiency and competition or the instrument of monopolist?," Energy Policy, Elsevier, vol. 135(C).
    7. Locatelli, C., 2020. "Une lecture institutionnaliste de la réforme du secteur gazier russe," Working Papers 2020-04, Grenoble Applied Economics Laboratory (GAEL).

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    Keywords

    Russia; Natural gas; Gazprom;
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