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16th MOSCOW INTERNATIONAL OIL AND GAS EXHIBITION MIOGE 2019
23-26 April 2019 • Moscow • Crocus Expo

Russia’s major arctic oil & gas equipment needs

News
The Arctic is a gold mine for Russia’s oil & gas producers – but it needs specialist technologies rarely manufactured domestically to extract the region’s mineral wealth.
Russia’s major arctic oil & gas equipment needs

Russia looks to the Arctic to increase oil & gas production

The Arctic is a key territory for Russian oil & gas companies
 
Many of Russia’s major oil & gas projects are taking place in the Arctic circle. Whether on or offshore, Russian majors are determined to mine this ultra-cold region for all it’s worth. 
 
Rosneft’s 28 Arctic licenses alone hold 34 billion tons of recoverable oil. That’s the equivalent of 249.22bn barrels. Gas volumes are massive too. According to Chatham House, there is as much as 43 trillion cubic metres of gas lying in the frigid north.
 
All told, Arctic resources cover about 14% of Russia’s total oil reserves and 40% of natural gas. Putting a figure on it, that’s as much as $20 trillion.
 
It’s little wonder why the majors are investing heavily in activity in this region. Novatek’s two Arctic LNG hubs have a combined cost of over $50bn. Back to Rosneft, and Russia’s NOC is on track to invest $4.3bn in exploration between now and 2021.
 
While the sums and resources are huge, there is one issue: much of the equipment required to tackle E&P activity in this most hostile of environments comes from overseas.

Russia is reliant on imported oil & gas equipment to complete projects at the best of times, but adding in the Arctic’s harsh conditions? That only increases the need for foreign-made equipment.
 

What kind of Arctic oil & gas equipment does Russia need?

Russia requires imported Arctic-resistant oil & gas technologies.
 
In short, a lot of equipment is needed for Russia to develop its Arctic resources. The required solutions cover everything from complete ice-resistant drilling platforms through to IT solutions and mass transportation/storage facilities.
 
That means equipment such as:
 
• Ice-rated drill heads
• Cold-resistant well caps
• Undersea umbilicals rated for extreme cold
• Geological surveying equipment
• Gas transmission & transport equipment
• Oil transmission & transport equipment
 
This also includes solutions like icebreakers and LNG tankers. Hyundai, for example, has been contracted to supply 15 ice-class LNG vessels for the Yamal LNG project. Asian shipbuilders are in particular demand for such vessels with Japan’s MOL and Chinese fabricators COSCO controlling 7 LNG carriers for Yamal.
 
The nature of these extreme low temperature territories, and the technology required, means Russia’s oil & gas companies are dependent on international manufacturers to supply it. For example, the below breaks down looks at project location, in-demand equipment, some of the companies involved and dependency levels:
 
• Arctic offshore – Gazprom, Rosneft – Drilling Rigs – High dependency
• Kara Sea – Rosneft – Subsea processing equipment – High dependency
• Okhotsk Sea – Gazprom, Rosneft – Subsea processing equipment – High dependency 
 

Prirazlomnaya platform highlights Arctic technology synergy

The Prirazlomnaya platform was designed from the ground up to deal with Arctic weather.
 
Image: © Gazprom
 
A good example of the required fusion of technologies required to tackle extensive Arctic projects comes from Gazprom Neft and its Prirazlomnaya offshore oil production facility.
 
Prirazlomnaya platform was designed from the ground up to cope with the sub-zero temperatures of its namesake field - currently the only oil project on the Arctic shelf.
 
The platform is used for all production operations, including oil drilling, extraction, storage, treatment, and offloading. 
 
All wellheads drilled onsite are located within the platform itself. The foundations provide a buffer between the sea and the well itself. Umbilicals are obviously cold-rated, and spread into a spider configuration, extracting oil to the oilwells. Anti-blowout devices have been worked into each wellhead. An offloading line connects processing and transmission technologies to docked oil tankers too.
 

Localisation: a possible supply solution

 
With international sanctions on Western-made equipment making its way to Russia still in place, localised production of said equipment is one strategy being used to get the gear to production sites.
 
Some companies were already ahead of the curve. NOV-Kostroma, a subsidiary of National Oilwell Varco, is already building and shipping Russian-made drilling rigs to offshore and Arctic developments. 
 
In particular, the company’s 225 MT Mobile Drilling Rig is being built in Volgorechensk. Rig base and mast-manufacturing takes place there too, using technology built and tested for Canadian projects within the Arctic Circle. Those conditions are similar to those in the Russian Far North, so NOV-Kostroma’s rigs are well suited to Russian majors’ needs.
 
For more information on localisation of oil & gas equipment in Russia, download our free report today.

Download our guide to Localised oil & gas equipment manufacturing in Russia


The Russian Arctic: A land of opportunity for international oil & gas equipment manufacturers

 
To the outsider, the Arctic is cold, unforgiving and icy; a snow-covered landscape stretching as far as the eye can see, but for international supplier of oil & gas technology, it’s a land rich with opportunity.
 
The majors require specialist equipment, so find the buyers at MIOGE.
 

MIOGE 2019: Russia’s no.1 international oil & gas equipment exhibition 

 
The Moscow International Oil & Gas Exhibition is the meeting place for the international community and Russia’s oil & gas industry. Over 560 companies trust the show to let them meet and do business with representatives from across the value chain.
 
Here, you’ll meet the players behind the Russian oil & gas projects listed above, as well as getting details on Russia’s project landscape from to 2025 and beyond. 
 
Find procurement, engineering and purchasing specialists exclusively at MIOGE. 
 
Russian majors, including Gazprom, Tatneft, Rosneft and Lukoil, attend the show every year. Why? To meet new partners and suppliers of in-demand oil & gas equipment and technology.
 
To reserve a stand, click here
 
Want more information on how MIOGE can help grow your business in Russia’s enormous oil & gas industry? Contact our team today.