Russian 2.5 billion natrual gas project

Moscow, Russian Satellite News Agency, Nov. 27, 2018 - The Russian Ministry of Energy has drafted a plan for the development of the natural gas engine fuel market by 2024. It is estimated that 175 billion rubles (about US$2.5 billion) will be allocated for the implementation of the plan. The key goal of the plan is to triple the number of gas filling stations and quadruple the gas sales of these stations.

Russian media reported that the plan provided 17.47 billion rubles ($2.66 billion) to subsidize oil companies, car manufacturers and local governments for the purchase of public transport, as well as other market participants. For example, the plan stipulates that oil and gas companies that build new gas filling stations will receive subsidies ranging from 25% to 40% of construction costs. The Russian Ministry of Finance's Information Service told the Russian RBC website that the funding plan has not yet been agreed and the document is under consideration.

According to the drafters of the plan, the factors affecting the development of natural gas engine fuel market at present include the insufficient number of natural gas filling stations and the inadequate natural gas infrastructure in railways and ports. In addition, Russian production of vehicles, professional and agricultural technology equipment using natural gas as fuel, as well as equipment using natural gas engines, is insufficient, and similar foreign technology equipment is expensive.

The Ministry of Energy expects that as a result of the implementation of the project, the domestic market for natural gas sales in the transportation sector will quadruple, from 685 million cubic metres in 2018 to 3.8 billion cubic metres by 2024. Meanwhile, 1 400 gas stations are planned to be built before this deadline. According to optimistic forecasts, the Russian Ministry of Energy predicts that the demand for natural gas in the transportation sector will increase to 1.7 billion cubic meters per year by 2030, while the number of vehicles using natural gas will increase to 700,000.