Minister of Energy Alexander Novak focused on the performance in 2012 of the energy sector, shared information on developments in the fuel and energy complex, outlined the main challenges to the oil and gas, electricity, and coal industries and possible responses to them, and highlighted priority federal projects and his Ministry’s tasks for the future.
He gave a positive assessment of the performance of the fuel and energy complex. Oil production increased to 518 million metric tons in 2012, exceeding the 1990 level for the first time. Oil refining was also the highest since the collapse of the Soviet Union, topping 270 million tons. Coal production rose by 5.2% to over 354 million tons, also a post-Soviet record. In parallel, exports rose to 131 million tons, mostly as a result of increased supplies to Europe. Only gas production fell, to 654.4 billion cubic metres, as a result of a drop in demand in Ukraine and Western Europe. But the construction of new LNG plants and new production centres in Eastern Siberia, which were launched in 2012, paved the way for building up gas exports into the promising markets of the Asia Pacific Region. Electricity production increased by 2.3% in 2012 and the rated capacity of power plants comprising the Unified Power Grid of Russia increased by 6.5 GW to 223.1 GW.
The main challenges facing fuel and energy companies were associated with the development of new technologies which made it possible to bring the production of energy resources closer to where they are consumed. Mr Novak said that these challenges could not be addressed unless the Government speeded up modernisation, boosted investment attractiveness and cut the energy/output ratio in the fuel and energy complex. In particular, fundamental decisions had been approved in the oil and gas sector and the relevant legal infrastructure had been developed to facilitate the geographic expansion of production areas, diversify supplies of hydrocarbon raw materials, stimulate production on the Russian shelf and production of hard-to-recover reserves, increase Russia’s share of the growing LNG market and encourage domestic demand.
Following his report, Alexander Novak answered questions from State Duma deputies.
Source: Ministry of Energy
