Royal Dutch Shell is in talks with Gazprom over the development of gas reserves on Russia's Yamal peninsula, a remote area north of the Arctic Circle.
Gazprom currently holds most of the gas reserves on Yamal, but is yet to start production or to build pipelines there. Yamal is estimated to contain 10 trillion cubic metres of gas, equal to one third of Gazprom's reserves. The firms plan to produce the first 15 billion cubic metres of Yamal gas in 2011, before raising output to 250 billion cubic metres a year. Russian energy minister, Viktor Khristenko, says a Russian-Dutch business council has already decided to form a committee to start working on the project. “Our Dutch colleagues have presented their views on developing the Yamal peninsula and the Kara Sea shelf using innovative technology, which involves both pipelined and liquefied gas. Yamal itself will require not less than 200 billion euros in investment. This project is much more ambitious than that on Sakhalin,” said Viktor Khristenko.