UPDATE 1-Gazprom confirms Shtokman LNG export start in 2014

Thu Feb 21, 2008 3:13pm GMT

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MOSCOW Feb 21 (Reuters) - Russia's Gazprom (GAZP.MM) confirmed on Thursday it would start pipeline gas exports from its giant Arctic Shtokman gas deposit in 2013 and begin shipments of liquefied natural gas (LNG) from the field in 2014.

Gazprom, Russia's gas export monopoly, Gazprom made the statement after officially setting up a joint operating company to develop Shtokman's first phase together with France's Total (TOTF.PA) and Norway's StatoilHydro (STL.OL).

"This project will serve the purpose of steady and secure gas supplies to Europe... By 2013 we will send 11 billion cubic metres a year of gas and in 2014 we will have volumes of 7.5 bcm a year of LNG," Gazprom's head Alexei Miller said after signing the agreement at the firm's Moscow headquarters.

The venture, created on Thursday after a two-month delay, will build and operate infrastructure at the gas deposit, which could supply Europe and the United States with pipeline gas and LNG for decades.

It will help Gazprom further increase its role as the world's largest gas producer and supplier of a quarter of Europe's gas.

Gazprom will own 51 percent in the Switzerland-registered venture, while Total and StatoilHydro will hold 25 percent and 24 percent, respectively.

Gazprom wants to develop Shtokman, one of the world's biggest gas fields -- with reserves estimated at 3.8 trillion cubic metres of gas and about 37 million tonnes of gas condensate -- in four stages.

The first stage is expected to cost $15 billion. (Reporting by Amie Ferris-Rotman, Writing by Tanya Mosolova, editing by Anthony Barker)