Russia will keep Europe hooked on its natural gas for years to come, using its huge reserves and lower production costs in Siberia to maintain attractive prices, according to state-run Gazprom PJSC.
The Moscow-based exporter, which supplied 34 percent of the European Union’s gas last year, sees its market share holding or rising slightly to about 35 percent by 2025 as production shrinks in the 28-member block, Gazprom management board member Oleg Aksyutin told investors in Singapore Tuesday. Pipeline supplies to Asia are set to begin in 2019 at the earliest.
“Europe was, is and will remain Gazprom’s priority market,” Deputy Chief Executive Officer Alexander Medvedev said at the same event. “We can’t see yet who else could offer European customers natural gas that’s as affordable.”
Europe has sought to reduce dependence on the Kremlin-backed company as tensions with Ukraine, which hosts major transit pipelines, have raised concerns about the security of Russian gas supplies. Gazprom has spare production capacity to tap and is expanding its gas-transportation network, circumventing its former Soviet ally, to remain competitive. Its sales abroad provide more than 10 percent of Russia’s overall exports.
