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15 Jul, 2008 03:46

Gazprom expansion moves to Africa and Iran

Russian natural gas monopoly Gazprom will develop oil and gas together with Iran’s state oil company. The decision came after Gazprom`s recent offer to buy all of Libya’s spare exportable gas volumes.

Gazprom is extending its international reach day by day. Right after opening its first African office in Algeria – the company offered to buy all of Libya’s spare oil and gas exports.

Elsewhere on the same continent, it is looking at exploration licenses in Nigeria and possibly to build a pipeline from the West African state to Algeria in the north. Spokesman Sergey Kupriyanov explained,

We are interested not only in the Middle East and Africa, but also in expanding our strategy beyond them. The target is to create full production cycles located in Russia and in other regions of the world.

That’s what has attracted Gazprom to Iran’s energy market. Not long ago Gazprom was included in the development of one of the biggest gas fields in the world. The South Pars gas project situated in the Persian Gulf is expected to produce more than 750 million cubic meters of natural gas a day when completed by 2014.

The visit of Gazprom executives to Iran on Sunday comes days after French energy company Total postponed plans to invest in the project. And some experts say Gazprom`s Middle East bid puts further pressure on any U.S. attempt to weaken Russia’s influence over Europe’s energy supplies.

Gennady Shmal, the President of the Oil and Gas Producers Union agrees, but says that Iranian gas will serve everyone.

I don't think the Russian Iranian joint venture will be appreciated by the west. But at the same time there's no basis for blocking Gazprom's or Russia's actions. Because the joint venture will improve the situation in the gas sector for the whole world, especially for countries where there's no gas like India or China. Iranian gas will serve everybody.

Gazprom`s interests range from exploring new fields and improving pipeline networks to modernizing existing facilities in partner` countries.Experts say this strategy of extending the company’s geographical reach is only the beginning.