Russia remains warm on Arctic projects
Despite arduous operating conditions, Covid-19 further challenging the economics and the threat of further Western sanctions, growth in the region remains a core priority for the government
The Arctic is the final frontier for Russian E&P. The territory holds an estimated 48bn bl of oil and 43tn m3 of gas reserves, more than any other country with an Arctic foothold. But low energy prices are piling the pressure on Arctic projects, which already operate in difficult conditions—not only in terms of high capital costs due to complex terrain and cold weather, but also because of Western sanctions. The Russian government sees exploitation of its Arctic reserves via LNG as the crux of its Energy Strategy to 2035, released in April. The plan includes tripling domestic LNG output by 2024 and the optimisation of exports through the Northern Sea Route, a major trade passage north
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