Seeing the Gazprom logo, you might wonder what new we can show you about it. It precedes each news program, and these days Gazprom celebrates its 25th anniversary. Nobody is surprised by the phrase "a national treasure" after a quarter of a century.
Indeed, without any fanfare, Gazprom is a national treasure. First, let us pay tribute to the heroic geologists and gas specialists of the Soviet Union who crossed Orenburg, Western Siberia, and the Far East to reach the fields. Before they could even be used to bring such income to the country, they first had to be discovered and developed. Second, let's remember the great names of Rem Vyakhirev, Vyacheslav Sheremet and, of course, Viktor Chernomyrdin. Anticipating drastic changes in the country and the world, they saved the industry 25 years ago. The process was complicated, not always linear, and sometimes the Gazprom company looks like a ministry. But compare the current state of Gazprom and the majority of the USSR's branch ministries. Gazprom pulled through and is one of the world's leading energy giants.
In this context, Vladimir Putin has held a meeting with Gazprom CEO Alexei Miller. Moreover, yesterday Chancellor Angela Merkel noted that the new Nord Stream 2 gas pipeline approved by Germany didn't threaten European energy security. She made the statement at a joint press conference with the Prime Minister of Poland.
That is, Gazprom is not just a national treasure. It's what all of Europe rests on, not depends on, but rests on. But, of course, how Moscow sees Gazprom's strategic importance is of paramount importance. President Putin has addressed the company's senior executives and staff.
President Putin: "For many years, when in the 1990s and the early 2000s our national economy was experiencing difficulties, Gazprom largely helped the economy to stay afloat. The company produced the much-needed resources for power and heat generation, and it did it at prices and rates that were clearly below market rates. Thanks to that, other industries could concentrate on their operations. Gazprom itself has made immense progress in technological modernization and in expanding its opportunities. I congratulate you and all the employees of Gazprom on achieving such results. I wish you all a happy anniversary".
Then Putin had a video conference with 4 new sports complexes which have been built in Komsomolsk-on-Amur, Kursk, and two villages of the Bryansk and Voronezh regions as part of the Gazprom for Children program. Everybody who saw Gazprom's commercials knows it. For many years, these commercials have combined 2 subjects: economic development and social programs.
Why was the commercial concluded with the words "the Power of Siberia," meaning the gas pipeline going to China, replaced before the anniversary? The new one doesn't even mention Siberia, showing a close-up of the TurkStream pipeline instead. We discussed it with Alexei Miller frame by frame after his meeting with the President.
- Hello, Alexei Borisovich. Happy anniversary!
- Thank you.
- Was it you who edited Gazprom's new commercial?
- Partly.
- Then I'll look into it. As a global company, how have you survived that global fall in oil and gas prices? Where are you now after the prices began to recover?
Alexei Miller, Gazprom CEO:
- Not only the price but also the volume of demand matters to us. In recent years, our income had been determined by exports, for the most part.
- So, volume made up for low prices?
- Of course, over the past 3 years, Gazprom has increased gas exports by more than 30%.
The largest hydrocarbon reserves
- Didn't increasing exports to Europe affect the untapped supply? I mean, do we have enough reserves? It's mentioned in the commercial.
- Gazprom has the largest reserves in the world—more than 17%. The reserves' increment exceeds the extraction volume. That is, our reserves only grow every year, despite the growing extraction rates and the increased supply to the market. To date, the company's proven and estimated reserves are 49 trillion cubic meters of gas. We feel more than confident. We can fully satisfy the demand of Russian consumers as well as the European demand for Russian pipeline gas.
A reliable gas-supply system
- The question may not be relevant, but I still want to ask it on the anniversary. Ukraine isn't seen as a reliable route anymore, is it?
- In regards to Ukraine, we currently consider the northern gas transport corridor from Yamal as the major one. As for the central gas transport corridor, which was used for supplying gas to Europe through Ukraine, its section on the territory of the Russian Federation is just as relevant as it was 10-20 years ago. However, gas supplies to Europe via the northern corridor, the Nord Stream-2 gas pipeline, is the shortest, most efficient, and cheapest route.
- Congratulations on the recent German decision to approve the Nord Stream.
- Thanks.
- Do you think that the Danes, Finns, and other states involved will follow the Germans?
- No doubt, Germany's decision to allow the construction of the Nord Stream 2 offshore gas pipeline in its territorial waters and the construction of a receiving terminal near Greifswald was a key decision. It is decisive for the future of the project. I believe that we'll move on to the final stage in the future.
- Let me quote Gazprom's previous commercial: "The power of the family, the power of will, the power of traditions, the power of Siberia."
The Power of Siberia pipeline.
- But the new commercial doesn't mention the Power of Siberia, but it shows the TurkStream. Has the Power of Siberia become secondary?
- No, as the Power of Siberia pipeline goes, we've reached the final stage. Next year, on December 20…
- That's a rather special date, isn't it?
- Yes, it is, but it just worked out that way. It's a magical date. Gas supplies to China will start on December 20. Thus, this is the final stage.
- Therefore, the TurkStream is mentioned as a prospect, but this one is almost done?
- Two-thirds of the linear part of the gas pipeline have already been built. Delivery will begin as scheduled.
- Are the current oil and gas prices enough for you to make the Power of Siberia profitable fairly quickly?
- We have no doubts about the profitability of the gas pipeline. The price formula set forth in the contract with China makes us feel confident about the current prices of hydrocarbons.
- Here is my last question stemming from the agenda set by the commercial you partly edited.
Hundreds of innovations
- Nowadays, innovation is obviously the answer to sanctions, because, obviously, some technologies are no longer supplied to Russia. What is the most interesting thing you can boast of in this context?
- Probably the most interesting thing is that we buy 100% of pipes only in Russia these days. We are practicing import substitution with our other suppliers, too. It's worth noting that we've reached excellent results. 95% of all material and technical products purchased by Gazprom are made in Russia.
- 95%?
- Yes, 95% are made in Russia. The remaining 5% are sometimes called "critical imports." But we'll deal with it in the near future, too.
- Well, congratulations! Thanks, Alexei Borisovich.
- Thank you.
