Natural gas in Russia

[citation needed] According to The World Factbook estimate, the country also has the largest proven reserves (47 trillion cubic meters (tcm)).

[8] Often netback calculations[clarification needed] have been used,[9] but there are arguments against their validity in determining the size of domestic subsidies.

Gazprom has had its gas sale price to domestic and industrial customers regulated by the Russian government since 1991, sometimes close to the operational cost, meaning that it needs to obtain high export sale values to generate a profit to subsidise the poor domestic return.

[6] The level of flaring increased in 2022 following the loss of the export pipelines to the EU to 1.6 bcm per annum, 9,000 tonnes of CO2 being emitted daily.

Germany, previously the main purchaser of Russian gas, reduced, then ceased imports by December 2022, as had most of the other EU countries.

[20] Production of Russian gas in 2022 was 20% lower than in 2021 and it is likely to be years before Russia will find alternative buyers for the lost 120 bcm EU export market.

[26] The agreement was reached as Chinese and Russian leaders met to discuss greater cooperation in Asia without involvement of Western powers.

It allows Russia to diversify its natural business outside of Europe and weakens the force of economic sanctions placed by the West in the aftermath of the Russian annexation of Crimea.

A new pipeline Power of Siberia 2, with a 50 bcm annual capacity that will run 6,700 km (4,200 mi) across Russia, Mongolia and China is proposed for construction 2024-2029.

Ukrainian officials at first denied the accusation, but later Naftogaz admitted that natural gas intended for other European countries was retained and used for domestic needs.

[30][31] The dispute reached a peak on 1 January 2006, when Russia cut off all gas supplies passing through Ukrainian territory.

[33][34] In September 2009 officials from both countries stated they felt the situation was under control and that there would be no more conflicts over the topic,[35][36] at least until the Ukrainian 2010 presidential elections.

Sanctions on Russian banks make it hard for Gazprom to receive money from international sales, which in 2022 fell 45.5% to 100.9bcm.

[46] Gazprom published a loss during the second half of 2022 of 1.3 trillion roubles ($17.3 billion) after losing 75% of its export sales.