Gazprom's investment in Vladivostok LNG plant seen at $13.5 bln


By Vladimir Soldatkin

MOSCOW, Nov 21 (Reuters) - Russia's top gas producer Gazprom is to invest $13.5 billion in its planned liquefiednatural gas (LNG) plant near the city of Vladivostok, the localgovernor said, double the previously stated investment in theproject.

Gazprom had previously put investment in the Vladivostokplant at 220 billion roubles ($6.7 billion), though a Gazpromspokesman said on Thursday the new figure also includesinfrastructure such as a port, gas pipeline and power station aswell as the plant itself.

Gazprom is competing for the upper hand in the global LNGmarket with rivals including Rosneft and Russia's No.2gas producer Novatek.

Competition for LNG exports is growing as Russia plans tolift Gazprom's monopoly in overseas shipments of the frozen gas.The lower house of parliament has already initially approved abill to liberalise LNG exports.

Gazprom plans to build the Vladivostok plant by 2018 with acapacity of between 10 and 15 million tonnes per year. Rosneft,jointly with Exxon, wants to launch a 5 million tonnesper year LNG plant on the Pacific island of Sakhalin in the sameyear.

The governor of the Primorsky region, Vladimir Miklushevsky,gave the new figure on the regional administration's web site,after meeting with Gazprom Chief Executive Officer AlexeiMiller. By comparison, Rosneft and Exxon have earmarked $15billion for their plant.

According to an industry source, Gazprom has chosen WorleyParsons as contractor for the initial front-endengineering and design for the plant. A spokeswoman at Worley'sMoscow office declined to comment.

Russian President Vladimir Putin has said the LNG businessand closer ties with Asian economies should be priorities forRussian companies, as European energy demand sags.

Russia now has a share of around 4.5 percent of the globalLNG market, which is dominated by Qatar. Russia aims to doubleits share by 2020 with the production of between 35 million and40 million tonnes a year by then.

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