Statoil and Gazprom jointly to sell gas

The two petroleum majors from Norway and Russia announced the signature of a non-binding Memorandum of Understanding (MoU) on Tuesday for the finalization of a series of separate, mutually beneficial agreements for cooperation on the U.S. gas import marked. A final agreement between Statoil and Gazprom Marketing & Trading USA are expected by the first quarter of 2010, Statoil writes in a press release.

The agreement on import and trade of gas to the marked in the United States is an important step for the cooperation between the two companies that already are partners together with French Total on the Shtokman Development AG. Shtokman Development AG is a joint venture established for financing, design, construction and operation of the first phase Shtokman gas condensate field in the Barents Sea.

Much of the gas from Shtokman is expected to be sent as LNG to the U.S. marked, as earlier reported by BarentsObserver. When the Shtokman project is fully operating, it will produce 400 tankers of LNG per year, as reported by BarentsObserver last month. Gazprom plans to ship 80 to 90 percent of the gas from the Shtokman field in the Arctic to the marked in North America.

In the United States, the two gas majors will cooperate on regasification capacity at the Cove Point terminal in Maryland near Washington D.C. on the east coast. According to the MoU signed Tuesday this week, Gazprom Marketing & Trading USA will, under a separate LNG throughput agreement, receive access to 50 million cubic feet per day, approximately 0.5 billion cubic meters per year of regasification capacity at the Cove Point terminal.

Later, Gazprom Marketing & Trading USA could receive long-term access to 200 million cubic feet per day of regasification capacity at the Cove Point terminal for 18 to 20 years.

Statoil ASA’s US affiliate, Statoil Natural Gas, has a long-term throughput arrangement with Dominion, the owner of the Cove Point-terminal which is an import terminal for gas to the US east coast.

Here, liquefied natural gas is delivered, stored and regasified to become pipeline gas.

Since 2003, Statoil has delivered LNG to Cove Point. The group has access to a total capacity of some 10 billion cubic metres of gas annually.

-The regasification agreements with Statoil will enable Gazprom Marketing & Trading USA to import significant volumes of LNG purchased from Russia and other sources, both short and long term, and will provide a firm foundation for our long term LNG supply strategy. Our gas purchase agreement enables us to strengthen our North American marketing and trading operation, which we launched on October 1st, and provides us with gas supplies in areas of strategic importance, said John Hattenberger, President of Gazprom Marketing & Trading USA in the press release posted at Statoil’s website.

Irene Rummelhoff, senior vice president for International Gas Development in Natural Gas in Statoil, says the deal is an important broadening of the successful commercial relationship between the companies in the Gazprom Group and Statoil.

- The agreement is an important step in Statoil’s efforts to ensure supply for our LNG-import and regasification capacity at Cove Point, says Irene Rummelhoff.