Norilsk Nickel takes on Arctic gas

Norilsk Nickel, the world’s biggest nickel producer, has boosted its stake in the regional Norilskgazprom company to 40,48 percent, consequently taking over control of the gas company from state-owned Rosneftegaz, Oilru.com reports.

With its acquisition, Norilsk Nickel signals an enhanced interest in the gas resources of the far-northern Taymyr Peninsula. From before, the nickel producer controls also the Taymyrgaz, another regional gas producing company.

Both Norilskgazprom and the Taymyrgaz are key suppliers to Norilsk Nickel’s industrial activities in the region, and first of all the huge melters in the city of Norilsk. A pipeline system, independent of federal grids, connects regional fields with the melters in Norilsk, as well as with the port of Dudinka, the export terminal at the Yenisey River.

The expansion into the gas market is part of Norilsk Nickel’s long-term strategy, and is first of all aimed at securing energy to the melters in Norilsk. However, at the same time the company admits that it also eyes an engagement in the gas industry, which goes far beyond Norilsk. In a recent press release, the company confirms that its gas strategy for the period up to year 2030 includes the possible development of gas exports, as well as the construction of new oil and gas processing facilities.

The Taymyr, the huge Arctic peninsula, is believed to hold substantial oil and gas resources.

At the moment, the companies Norilskgazprom and Taymyrgaz both produce about 1,7 billion cubic meters (2011) per year reports from the companies show. The latter also controls processing facilities near Dudinka.

Part of the hydrocarbon resources produced at Taymyr, and first of all gas condensate, is already exported. As previously reported, Norilsk Nickel in 2011 acquired its first ice-protected tanker, which will shuttle condensate and other petroleum products to and from Dudinka.