Yamal has 147 trillion m3 of initial total natural gas resources. This is almost 10 times more than was extracted from the subsoils of the region for almost half a century of active mining. Oil and condensate reserves are 23 billion tons. They are mastered by 5 - 6 percent.

Therefore, the socio-economic development of the Okrug is based largely on the further development of hydrocarbon production. In this regard, the long-term prospects for increasing investments in the development of new gas and oil fields in the Autonomous Okrug are obvious.

Most of the prospective oil and gas reserves are located in the north of the Okrug – in the Arctic area. And it is there – to the North,  where we are moving now. For example, only the Yamal Peninsula has prepared proven gas reserves of more than 17 trillion m3. The industrial development of this peninsula compensates for the natural decrease in gas production in the base fields of the Nadym-Pur-Taz region.

With the further construction of natural gas liquefaction (NGL) plants, the Okrug becomes the main producer of NGL in Russia, and in terms of the domestic economy, it acquires additional resistance to fluctuations in the world hydrocarbon prices. We are now talking about the fact that there is a second basic industry – high-tech gas processing – in the monoregion. They include not only NGL plants, but also the Novy Urengoy gas chemical plant, associated petroleum gas processing enterprises, as well as even such exotic projects as methanol production.

The third strategic direction of development is the creation of a unified transport corridor in the center of the Russian Arctic. It will be based on the Northern Latitudinal Railway and Northern Latitudinal Railway 2 railway lines, and the Arctic seaport of Sabetta located on the Yamal Peninsula will become the “exit point to the world”. The railway construction will provide an opportunity to fully implement the tasks set by the President of Russia for the development of the Russian Arctic. In particular, this will allow developing new production, reducing time and simplifying the delivery of goods from the Western Siberia by unloading the Trans-Siberian Railway. This is an extremely important project for both the country and the Autonomous Okrug.

The Yamal megaproject is being implemented by Gazprom PJSC and, indeed, has no analogues in the world in terms of complexity due to the inaccessibility of the territory and extreme climatic conditions. Suffice it to say that in order to start exploring the hydrocarbon deposits of the peninsula, the national gas concern built a special railway, “Obskaya – Bovanenkovo - Karskaya”, with a length of almost 572 kilometers.

If we talk about Russia, Yamal will become the main producer of LNG in our country in a few years. If we talk about the global market, the LNG production development strategy in our Okrug provides for the possibillity to produce 70 million tons of LNG per year or more. According to the Gas Strategies analytics company, the volume of LNG production in the world amounted to 292 million tons in 2017.

Now, ahead of schedule, two lines of the Yamal LNG plant have already been put into operation in Yamal (let us recall that Russian President, Vladimir Putin, took part in the ceremony of loading the first batch of liquefied natural gas from the Yamal LNG plant in December 2017). A gas tanker Christophe de Margerie with Yamal LNG on board recently set a new speed record along the Northern Sea Route. According to Sovcomflot, a tanker without icebreaker escort traveled 2,360 nautical miles from Sabetta to Cape Dezhnev (Chukotka Peninsula) in just 7 days 17 hours.

The second LNG plant – Arctic LNG-2, the resource base of which will be the Salmanovskoye (Utrenneye) field on the Gydan Peninsula,  is now at the pre-design stage: a basic project is being developed in accordance with the international requirements, various technical solutions stipulated by both Russian and international experience are being studied to choose the most optimal and safe solution for the plant. In addition, the resource base for the third LNG plant on the Yamal Peninsula is currently under consideration and the possibility of building methanol production in Sabetta is also being discussed.

We have already raised this issue by discussing the development of high-tech LNG production in Yamal. Considering gas chemistry separately, we are continuing the construction of the Novy Urengoy gas chemical complex (NGCC). It will process ethane-containing gas, which is a by-product from gas condensate deethanization. The processing plant’s capacity should be 1.4 million tons per year, while the plant plans to produce up to 400 thousand tons of polyethylene of various brands annually. The creation of a gas chemical cluster and the production of packaging materials, household items from polyethylene, stretch film, etc. is supposed to be created on the basis of NGCC.

It should be understood that the degree of development of large processing industries directly depends on the transport network capacity through which their products are exported to the foreign markets. Therefore, one of the most important tasks that we set for ourselves is the creation of an end-to-end transport corridor in the center of the Russian Arctic, through which millions of tons of goods of domestic producers could get access to the world markets in the shortest possible way through the Yamal port of Sabetta. They include also the products of the Yamal gas chemistry.

Yes, this is a project that we have been working on a lot in recent years with our Yamal colleagues, oil and gas companies and federal ministries, and which has now been brought to life. In August, the Chairman of the Government of the Russian Federation, Dmitry Medvedev, signed a Decree of the Government of the Russian Federation regulating the conclusion of a concession agreement with Northern Latitudinal Railway LLC on the subject of financing, construction and operation of the infrastructure of public railway transport “Obskaya - Salekhard – Nadym”. At the same time, Russian Railways OJSC will provide financing and reconstruction of the “Konosha - Kotlas - Chum – Labytnangi” railway line, while Gazprom will provide financing, design, reconstruction and commissioning of the “Nadym – Pangody” railway line. The government of YaNAO will invest in the construction of the automobile part of the bridge across the Ob river and will provide the necessary project documentation. Also, the region will transfer to federal ownership the land plots necessary for the polar line construction, as well as will provide builders with access to the water and forest facilities.

That is, we have got everyting now to launch the cutting-edge construction of the most complex and important element of the Northern Latitudinal Railway – combined railway and automobile bridge across the Ob river. Now we are doing everything with the investor in order to start it this winter. Moreover, we are engaged in a very productive dialogue with our key partners on how to bring the railway to the Obskaya station to the port of Sabetta. This is the project called “Northern Latitudinal Railway 2”. It is vital for the development of the central part of the Arctic, and we have all the opportunities for its implementation.

By 2025, we expect that oil production will rise to around 45 million tons per year. This is twice as much as was mined in Yamal a few years ago. Prospects are primarily associated with the creation of two new mining centers in the Arctic area – Novoportovsky on the Yamal Peninsula and Messoyakhsky in the North-Eastern part of the Okrug. Last winter, a 10 millionth ton of oil was already produced at the New Port. The industrial development of Messoyakha is primarily associated with the commissioning of the Zapolyarye-Purpe trunk oil pipeline in 2016. This pipeline made it possible to involve the largest oil fields in the Yamal-Russkoye, Zapolyarnoye, Vostochno-Messoyakhskoye, and Zapadno-Messoyakhskoye – in the development. It also included Pyakyakhinskoe and others, whose total resource base is estimated at 3.2 billion tons.

Yes, almost all projects on the Yamal Peninsula are now implemented ahead of schedule. For example, the third stage of Yamal LNG is planned to be put into operation in a few months – In fact, a year ahead of schedule.

The situation in the Autonomous Okrug is stable. Over 7 months of this year, the gas production in Yamal, compared with the same period last year, increased by 11 percent, oil – by 1 percent, gas condensate – by 12 percent. This is a good dynamics.

First of all, it is tax incentives and the removal of unnecessary administrative “barriers”. Investor relations should be as open and transparent as possible. Over the past 6 years, we have modernized regional legislation in the field of investment regulation. Due to the work of investment-active organizations in the economy of the region in 2012 - 2017, about 970 billion roubles of investments were attracted and more than 5,200 jobs were created.

We have formed and regularly update a list of organizations implementing priority investment projects. At the beginning of this year, it included 19 companies that received the right to state support in the form of tax preferences. We concluded with them the investment agreements on the implementation of 29 projects for a total amount of almost 3 trillion roubles.

We pay special attention to new forms of work with investors, such as concession. In world practice, this is the most progressive form of implementation of large capital-intensive initiatives, which allows them being fully funded.

Thus, due to the well-developed economic part of the project, under concession conditions, we were able to attract investors for the reconstruction of the airport complex in Novy Urengoy. The concession agreement was concluded for a period of 30 years and does not stipulate participation in the reconstruction of the airport budget funds. The Northern Latitudinal Railway is also being built on the principles of public-private partnership (PPP) in the form of concession in the Yamal-Nenets Autonomous Okrug. Taking into account the experience we have accumulated, we intend to continue to pay special attention to the individual approach and responsible study of project conditions, to work together with the private investors and to fulfill our obligations in a quality manner.

This year, for example, we changed the legislative framework for introducing a new support measure for large projects in the region, namely, an investment tax deduction. The pilot project will be the arrangement of oil banks on the fields with falling production. Thus, we plan to give a “second wind” to the old fields and to promote the extraction of hard-to-recover reserves in the region.

In accordance with the May Decree of the President of Russia, within the framework of the relevant national project, it is planned to intensify in the Autonomous Okrug the work on creating a high-performance export-oriented sector in the manufacturing and agricultural sectors, being developed on the basis of modern technologies and provided with the highly qualified personnel.

This year, we intend to adopt the Work Standard for the executive authorities of the Autonomous Okrug to ensure favorable conditions for the development of export activities, and we will put into practice a flexible line of financial and infrastructure tools to support export, including expanded pre-export, export and equity financing, as well as leasing and long-term support measures by 2020.