6.2. Combating Climate Change

Corporate Targets for Preserving the Climate

GHG emissions management is part of the Gazprom Group’s corporate strategy on environmental protection and climate change prevention.

The reduction of specific GHG emissions is the main driver behind the improvement of the environmental friendliness of production processes. The innovative development programs of PJSC Gazprom, PJSC Gazprom Neft, and Gazprom Energoholding LLC set respective key performance indicators (KPIs) until 2025. The Roadmap of Greenhouse Gases Emissions Management establishes the estimated indicators of specific GHG emissions until 2030 proceeding from different development scenarios.

2019 saw work start on developing sustainable development scenarios for PJSC Gazprom through 2050, taking into account the global shift to a low-carbon economy, with respective climate goals to be set.

PJSC Gazprom contributes significantly to the low-carbon economy development in Russia and the countries that import Russian gas thanks to gas infrastructure expansion and conversion of various vehicles to natural gas, thus helping reduce emissions made by energy consumers.

Reduction of Greenhouse Gas Emissions across the Gazprom Group

3.52 mmt of СО2 equivalent (1.5%)

GHG emissions decrease of the Gazprom Group in 2019, comparing to 2018

Direct GHG Emissions

GRI 305-1

In 2019, GHG emissions of the Gazprom Group’s facilities amounted to 236.5 mmt of СО2 equivalent, 14% of them were methane emissions.

Gazprom Group’s GHG emissions, 2016–2019, mmt of СО2 equivalent

Information on the GHG emissions of the Gazprom Group companies is provided in Appendix

All companies of the Gazprom Group carry out control and accounting of GHG emissions. Since 2016, all Group subsidiaries regardless of their business activities have been monitoring and calculating the quantity of GHG emissions according to a uniform procedure described in the Methodological Guidance on the Quantification of Greenhouse Gas Emissions by Entities engaging in Business and other Activities in the Russian FederationApproved by Order of the Russian Ministry of Natural Resources and Environment No. 300 dated June 30, 2015..

Gazprom was the first Russian company to calculate the amount of its emissions using the 100-year Global Temperature change Potential. As a result, the actual carbon footprint from Gazprom’s production activities proved to be lower by another 25.2 million tons of СОequivalent. This calculation was meant to provide a more accurate picture of the impacts made by emissions on the climate system, taking into account the recommendations of the Intergovernmental Panel on Climate Change (IPCC).

With account of the Global Temperature change Potential, GHG emissions of the Gazprom Group totalled 211.2 million tons of CO2 equivalent in 2019.

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In 2019, absolute GHG emissions across the Gazprom Group reduced by 1.5% as compared to 2018, which corresponds to the criteria of climate targets under the SBT initiative within the CDP.

The gas business reported a reduction in specific GHG emissions from 0.275 tons of CO2 equivalent per ton of oil equivalent in 2014 to 0.259 tons of CO2 equivalent per ton of oil equivalent in 2019, which was made possible thanks to the implementation of the Gazprom Group GHG Emissions Management Roadmap in the long term until 2030 and the Energy Saving and Energy Efficiency Program.

The methane detection at facilities of the Russian gas industry is addressed by using either stationary equipment or detectors installed in helicopters or unmanned aerial vehicles. In 2017–2019, PJSC Gazprom performed pilot testing of the gas leak tracing technology with the use of unmanned aerial vehicles.

To make more efficient use of modern space technologies, PJSC Gazprom is implementing a project to build a spacecraft assembly facility in Shchelkovo (Moscow Region). The first spacecraft to be assembled and tested at the new cutting-edge facility in 2022–2024 is Smotr-B earth remote sensing satellite that is planned to have a gas analyser installed on board. With the launch of the satellite, the Gazprom Group will be able to trace gas leaks from gas pipelines and its other production facilities more efficiently directly from space.

Energy Indirect GHG Emissions

GRI 305-2

To keep stakeholders updated on emissions along the entire production chain, PJSC Gazprom discloses its indirect GHG emissions. These are GHG emissions from the generation of purchased or acquired electricity or heating consumed by an organization.

Energy indirect GHG emissions at PJSC Gazprom by types of activities, 2018–2019, mmt of СО2 equivalent
Activity 2018 2019
Natural gas production 0.51 0.35
Natural gas transportation 4.62 3.33
Natural gas processing 2.98 2.34
Underground natural gas storage 0.10 0.06

In 2019, the Gazprom Neft Group’s indirect (Scope 2) GHG emissions within the perimeter of Russian subsidiaries amounted to 5.22 million tons of СО2 equivalent (in 2018: 4.38 million tons of СО2 equivalent). The growth in indirect GHG emissions in the reporting year is attributable to the fact that Gazprom Neft is expanding its geography of operations through prospecting for and evaluation of hydrocarbon reserves and is building up its infrastructure needed to produce and treat hydrocarbons and transport them to key customers, which results in more facilities generating additional GHG emissions.

Indirect (Scope 2) GHG emissions by PJSC Gazprom, PJSC Gazprom Neft, Gazprom Energoholding LLC, and Gazprom Neftekhim Salavat LLC stood at 13.8 million tons of СО2 equivalent.

2019 was the first year the Gazprom Group assessed indirect (Scope 3) GHG emissions resulting from the use of products as fuels or feedstock both in Russia and abroad. The calculation included GHG emissions from all types of products sold — natural gas, oil and gas condensate, automotive gasoline, diesel and jet fuel, LPG, and fuel oilTo account for all possible emissions when using Gazprom Group products, emission factors were applied in accordance with the Methodological Guidance on the Quantification of Greenhouse Gas Emissions by Entities engaging in Business and other Activities in the Russian Federation approved by Order No. 300 of the Ministry of Natural Resources and Environment of the Russian Federation dated June 30, 2015..

Gazprom Group’s GHG emissions (Scope 3), 2018–2019, mmt of СО2 equivalent
Product sold 2018 2019
Gas 956.15 930.09
Oil and gas condensate 78.71 83.84
Other energy resources 144.12 140.61
Total1,178.981,154.54
GRI 305-6

The Company does not use ozone-depleting substances on an industrial scale.

Flaring Reduction

90.1 %

was reached by the APG utilization across the Gazprom Group’s assets in Russia in 2019Including the share in production of organizations in which Gazprom has investments classified as joint operations.

GRI OG 6

The reduction in APG flaring plays a significant role in decreasing emissions of pollutants and greenhouse gases and saving resources. The Gazprom Group is implementing APG utilization investment projects at its fields with the aim of achieving an APG utilization level of at least 95%As per Resolution No. 1148 of the Government of the Russian Federation dated November 8, 2012..

In 2019, APG utilization was 98.5% at the fields of PJSC Gazprom’s gas production subsidiaries (including OJSC Tomskgazprom), 89.0% at the Gazprom Neft Group, 98.0% at Sakhalin Energy.

The actual APG utilization at the operating facilities of the Gazprom Neft Group reached 89.0% in 2019, i.e. increased by 10.6% versus 2018, with an actual rise in APG production amounting to 2.242 bcm (up 15.6%). An upward trend in APG utilization is attributable to the commissioning of facilities under the Gas program of Gazprom Neft and organizational and technological activities at the assets with well-developed gas infrastructure.

Dynamics of APG utilization at the Gazprom Group companies, 2016–2019, %

In 2019, APG utilization across the Gazprom Group’s assets in Russia (including the share in production of organizations in which Gazprom has investments classified as joint operations) reached 90.1% (whereas in 2018 it was 81.8%).

 

For more details on hydrocarbon flaring across the Gazprom Group see Appendix

Plans

The Gazprom Neft Group is aiming to ensure the required level of APG utilization along with the start of commercial development of new fields and an increase in oil and gas production volumes. Pursuant to the resolution of the Board of Directors of Gazprom Neft, APG utilization level of 95% is to be ensured at the assets with well-developed gas infrastructure in 2020 and throughout Gazprom Neft in general, including new assets, in 2022. To achieve the approved goals, the APG Utilization and Efficiency Program was developed that provides for the implementation of investment projects to build gas infrastructure.

Energy Saving and Energy Efficiency

1,830.98 million GJ

fuel and energy consumption by PJSC Gazprom subsidiaries

3.94 million tons

of reference fuel — fuel and energy savings by PJSC Gazprom in 2019

RUB 7,391 million

cost of fuel and energy saved by Gazprom Energoholding

Gazprom’s primary aim is to ensure reliable and efficient supply of natural gas and other energy resources to consumers, with efficient use of energy and fuel at all stages of the production cycle underpinning its sustainable development goals.

The Company’s energy efficiency activities are governed by the Energy Efficiency and Energy Saving Policy of PJSC GazpromApproved by resolution of the Management Committee of PJSC Gazprom No. 39 dated October 11, 2018..

The 2019 Corporate Targets required lower consumption and higher savings of fuel and energy resources, as well as measures to prepare for ISO 50001:2018 certification. These goals were met.

Energy consumption within the organization(1)

Fuel and energy consumption at PJSC Gazprom by energy resource, 2016–2019, million GJ(2)
Resource 2016 2017 2018 2019
Natural gas 1,357.30 1,571.21 1,698.57 1,614.72
Electric power 101.53 119.03 123.42 121.46
Heat energy 92.01 93.42 94.48 94.80
Total fuel and energy resources1,550.831,783.661,916.471,830.98
(1) Based on corporate reporting forms approved by a relevant order PJSC Gazprom on an annual basis. PJSC Gazprom’s Order No. 348 dated April 11, 2019 approved the following corporate reporting forms for 2019:
— 103-gas Fuel and Energy Efficiency Report of a Gas Transmission Subsidiary; — 105-gas Fuel and Energy Efficiency Report of Underground Gas Storage Stations;
— 106-gas Fuel and Energy Efficiency Report of Gas, Gas Condensate and Oil Processing Entities;
— 107-gas Fuel and Energy Efficiency Report in Gas Distribution and Supply;
— 143-gas Fuel and Energy Efficiency Report of a Gas Producing Subsidiary;
— 142-gas Progress under the Energy Saving and Energy Efficiency Improvement Program;
— Rosstat Order No. 713 dated November 28, 2019 «On Approval of Guidelines for Completing Federal Statistical Monitoring Form No. 4-TER Details of Fuel and Energy Utilization».
(2) Physical units of fuel and energy consumption (mcm, million kWh, thousand Gcal) were converted into units of energy (million GJ) using the following coefficients: 1 mcm ×1.155 = 1,000 tons of reference fuel; 1 million kWh × 0.325 = 1,000 tons of reference fuel; 1,000 Gcal / 7 = 1,000 tons of reference fuel.
1,000 tons of reference fuel = 0.0293076 million GJ.

2019 saw changes to the energy conversion formulae as per Rosstat Order No. 713 dated November 28, 2019 which introduced the requirement to use reference fuel units: “For all types of fuel, physical units shall be converted into units of reference fuel typically using their actual calorific values determined as the ratio of the net calorific value of fuel in an as-received condition to the calorific value of 1 kg of reference fuel, i.e. 7,000 kcal/kg”.

To provide a proper basis for comparison, fuel and energy consumption data for previous years used in the 2019 report were recalculated as per the abovementioned Rosstat Order.

Fuel and energy consumption at PJSC Gazprom by business activity in 2019, million GJ
Activity 2019
Gas production 268.06
Trunkilne gas transportation 1,374.61
Underground gas storage 20.48
Gas, gas condensate and oil processing 141.89
Gas distribution 25.95
Total fuel and energy resources1,830.98

PJSC Gazprom reduced its consumption of natural gas by 4.8% and that of electric power by 1.6% on the back of lower energy consumption in gas transportation as gas transportation volumes declined by 1.4% and energy intensity dropped by 3.2%.

Heat consumption rose by 0.3% due to higher heat utilization in gas condensate processing at the plants of Gazprom Pererabotka LLC caused by an 8.5% increase in volumes of unstable gas condensate processed.

Electric power and heat energy consumption for internal process needs in the core production activities of PJSC Gazprom, 2016–2019(1)
Resource 2016 2017 2018 2019
Electric power, million kWh 10,659.1 12,496.9 12,958.0 12,886.6
Heat energy, million GJ 92.01 93.42 94.48 94.80
(1) No separate records are maintained to track energy consumption for the cooling of buildings and facilities. No information is available on the actual energy consumed for cooling. Assuming the overall consumption mix and domains, the share of energy consumed for cooling might be marginal.
No separate records are maintained to track steam consumption. Assuming the overall consumption mix and domains, the share of steam consumption might be marginal.

Gazprom Neft generated a total of 28.2 MWh of energy from renewable sources (solar energy).

Energy consumption by the Gazprom Neft Group, 2016–2019, million GJ
Energy consumption 2016 2017 2018 2019
Electric power 57.0 69.1 66.7 66.9
Heat energy 43.7 43.1 44.7 42.4
Gas 97.7 100.3 112.7 118.2
Diesel fuel 0.9 2.7 2.4 1.7
Total199.3215.2226.5229.2

Gazprom Neft generated a total of 28.2MWh of energy from renewable sources (solar energy).

In 2019, Gazprom Energoholding’s energy consumption for internal needs totalled 4.8 million tons of reference fuel (140.85 million GJ).

 

Energy consumption for internal needs at Gazprom Energoholding, 2016–2019
Indicator 2016 2017 2018 2019
Total electric power consumption, million kWh 12,229 12,186 11,815 11,590
Total electric power consumption, thousand tons of reference fuel 3,625 3,597 3,448 3,352
Total heat energy consumption, thousand Gcal 10,327 10,152 11,087 9,907
Total heat energy consumption, thousand tons of reference fuel 1,524 1,491 1,631 1,455
Total gas consumption, mcm 0.64 0.67 0.03 0.02
Total gas consumption, thousand tons of reference fuel 0.75 0.78 0.04 0.02
Total, thousand tons of reference fuel5,1505,0895,0794,807

In 2019, Gazprom Energoholding’s fuel consumption from non-renewable resources totalled 51.6 million tons of reference fuel (1,511.85 million GJ).

Fuel consumption from non-renewable sources at Gazprom Energoholding, 2016–2019, million tons of reference fuel
Fuel type 2016 2017 2018 2019
Coal 7.5 7.1 5.9 4.9
Gas 48.9 47.5 47.7 46.2
Fuel oil 0.4 0.4 0.5 0.5
Diesel fuel 0.0 0.0 0.0 0.0
Other fuels 0.0 0.0
Total56.955.154.151.6

In 2019, Gazprom Neftekhim Salavat’s energy consumption for internal needs totalled 66.251 million GJ.

Energy consumption for internal needs at Gazprom Neftekhim Salavat LLC, 2016–2019
2016 2017 2018 2019
Electric power, million kWh 1,358 1,336 1,434 1,336
Energy for heating, thousand GJ 1,389 1,403 1,349 1,269
Energy for cooling, million kWh 232 216 245 231
Steam consumption, thousand GJ 34,022 35,105 38,177 37,024
Energy sold for heating, thousand GJ 258 274 273 0
Steam sold, thousand GJ 1,482 1,769 1,749 1,949
Overall energy consumption, including natural gas as a fuel, thousand GJ 66,66665,07569,22366,251
Fuel consumption from non-renewable resources at Gazprom Neftekhim Salavat LLC, 2016–2019, thousand GJ
Fuel type 2016 2017 2018 2019
Natural gas for production 16,451.2 14,508.2 15,733.6 15,019.4
Natural gas as a fuel 18,316.4 15,838.5 16,041.6 15,232.6
Total34,767.630,346.731,775.230,252.0

In 2019, total energy consumption by Gazprom Neftekhim Salavat LLC amounted to 81.27 million GJ.

Electric Power Sold

Gazprom Energoholding sells electric power produced by its generating companies — PJSC Mosenergo, PJSC OGK-2, and PJSC TGC-1. In 2019, it sold a total of 152,833.80 million kWh.

Electric power sold by Gazprom Energoholding, 2016–2019, million kWh
Company 2016 2017 2018 2019
PJSC Mosenergo 60,858.4 60,250.6 60,195.4 62,096.0
PJSC OGK-2 72,939.0 69,722.2 64,982.1 58,389.8
PJSC TGС-1 30,590.9 32,579.2 32,579.7 32,348.0
Total164,388.3162,552.0157,757.2152,833.8

PJSC OGK-2 tends to lower its electric power generation and sales, which is mainly caused by the fact that energy prices are growing faster than selling prices for electricity.

Reduction of Energy Consumption

GRI 302-4

In 2011–2019, PJSC Gazprom saved fuel and energy resources for a total of 26.4 million tons of reference fuel (773.5 million GJ), including:

  • 22.4 bcm of natural gas;
  • 2.5 billion kWh of electric power;
  • 2.0 million Gcal of heat.

For more details on fuel and energy cumulatively saved by PJSC Gazprom see Appendix

For the full list of entities covered by the PJSC Gazprom Energy Saving and Energy Efficiency Improvement Program see Appendix

In 2019, PJSC Gazprom’s energy saving program helped save fuel and energy resources in the amount of 3.94 million tons of reference fuel (115.5 million GJ), demonstrating that the Company delivers on its commitments to continuously improve the energy efficiency of its production processes and save natural energy resources across its production assets.

At Gazprom Neft, the Downstream and Upstream Divisions’ energy saving and energy efficiency programs helped save 4.1 million GJ of energy and 1.2 million GJ of electric power, respectively, in 2019.

In 2019, Gazprom Energoholding’s energy saving programs helped save fuel and energy resources in the amount of 1.61 million tons of reference fuel (47.33 million GJ):

  • fuel savings: 1,375.6 thousand tons of reference fuel, including 1,172.9 mcm of natural gas;
  • electric power savings: 670.8 million kWh;
  • heat savings: 297.2 thousand Gcal.

The cost of energy resources saved is RUB 7,391 million.

In 2019, Gazprom Neftekhim Salavat’s energy saving programs helped save fuel and energy resources in the amount of 55,199 thousand tons of reference fuel (1.6 million GJ):

  • natural gas savings: 43.5 mcm;
  • electric power savings: 1.3 million kWh;
  • heat savings: 35.6 thousand Gcal.
GRI 302-4

In all of its business activities, PJSC Gazprom implements energy saving program initiatives aimed at enhancing (maintaining) energy efficiency and reducing fuel and energy consumption, including energy losses. Measures being taken under corporate energy saving programs seek to save natural gas, electric power and heat.

 

PJSC Gazprom Energy Saving and Energy Efficiency Improvement Program implementation outcomes as of 2019
Activity(1) Natural gas savings, mcm Electric power savings, million kWh Heat savings, thousand Gcal
Gas, gas condensate and oil production 392.74 28.67 16.37
Gas transportation 2,810.36 236.79 42.02
Underground gas storage 19.76 3.57 0.00
Gas, gas condensate and oil processing 40.83 40.71 192.15
Gas distribution 22.56 8.91 1.72
Non-core business 0.67 11.84 0.48
Total3,286.91330.48252.74
Total, thousand tons of reference fuel 3,796.38 107.41 36.11
Total, million GJ 111.263 3.148 1.058
(1) for the list of corresponding subsidiaries see Appendix
Fuel and energy savings resulting from the implementation of PJSC Gazprom’s energy saving programs(1),(2)
Period Natural gas Electric power Heat energy Fuel and energy Fr
mcmmillion GJmillion kWhmillion GJthousand Gcalmillion GJmillion GJ%
2016 2,286.6 77.4 260.0 2.5 254.9 1.1 80.9 5.2
2017 3,013.5 102.0 331.5 3.2 268.4 1.1 106.3 6.9
2018 2,951.9 99.9 364.2 3.5 235.9 1.0 104.4 5.9
2019 3,286.9 111.3 330.5 3.1 252.7 1.1 115.5 6.0
In the table below, Fr (expressed in %) means the reduction factor for fuel and energy consumption resulting from the implementation of an energy saving program.

(1) The following industry standards were used to calculate the fuel and energy savings:
1. STO Gazprom 2-3.5-113-2007 Methodology for Assessing Energy Efficiency of Gas Transportation Facilities and Systems;
2. R Gazprom 2-1.20-819-2014 Methodology for Calculating Fuel and Energy Savings Resulting from the Implementation of Energy Saving Initiatives at Subsidiaries. The baseline is the previous year’s fuel and energy consumption.
(2) The consumption reduction results are calculated with due consideration of the data on natural gas, electric power, and heat energy used by PJSC Gazprom subsidiaries for internal process needs.

The factor variance is due to higher actual energy savings in 2019 versus previous periods as a result of additional natural gas saving initiatives in trunkline gas transportation and a lower total consumption of fuel and energy at PJSC Gazprom for internal process needs.

For the list of most important energy saving initiatives of PJSC Gazprom, Gazprom Neft and Gazprom Energoholding see Pages 46–49, PJSC Gazprom Environmental Report 2019

Gazprom Neft’s Downstream Division was implementing energy saving and energy efficiency programs for 2019–2021 aiming to save 619 million kWh of electric power in the reporting year. In 2019, the Upstream Division met its targets set for specific electric power consumption — namely, 24.57 kWh per ton of liquid, and also exceeded the targets under its Energy Efficiency Program by 39%, and achieved energy savings of 330 million kWh (versus the set target of 236 million kWh) across the Division. The values achieved in terms of specific electric power consumption per ton of produced liquid were 2.2% below the target level and amounted to 24.78 kWh (versus the target level of 25.34 kWh).

Gazprom Energoholding uses specific consumption in terms of reference fuel for power generation as an industry energy-efficiency metric. In 2016–2019, the overall reduction in specific consumption in terms of reference fuel for power generation across Gazprom Energoholding amounted to 10.9 g/kWh, or 3.6%.

Over the same period, specific consumption in terms of reference fuel for heat generation rose by 0.3 kg/Gcal, or 0.2%.

The total fuel savings due to changes in specific consumption in terms of reference fuel were driven by the launch of facilities under capacity supply agreements (CSAs), as well as by other measures taken, including the decommissioning of inefficient equipment, shifting of thermal capacity from boiler houses to power plants, and implementation of energy saving technologies.

The measures provided for by energy saving programs aim to reduce the consumption of fuel and energy resources, including fuel, electric power, heat, water, etc.

Total reduction in energy consumption as a direct result of energy saving initiatives at Gazprom Energoholding, 2016–2019, thousand tons of reference fuel
Outcomes of energy saving and energy efficiency improvement programs’ implementation at Gazprom Energoholding in 2019
Fuel savings,thousand tons of reference fuel Electric power savings, million kWh Heat energy savings, thousand Gcal
TotalIncl. gas
Total 1,375.6 1,364.6 670.8 297.2
Total, million GJ 40.3 40.0 2.4 1.2

Gazprom Neftekhim Salavat achieved the following results through its energy saving and energy efficiency improvement initiatives.

Results of energy saving and energy efficiency improvement programs’ implementation at Gazprom Neftekhim Salavat LLC, 2016−2019
Indicator 2016 2017 2018 2019
Natural gas savings, mcm 0.000 49.935 43.783 43.511
Electric power savings, million kWh 0.286 0.880 0.440 1.311
Heat energy savings, thousand Gcal 4.799 21.503 49.675 35.559
Total, thousand tons of reference fuel0.77961.03357.80955.761
Total, million GJ0.0231.7891.6941.634

Goals and Targets for 2020−2022

2020–2022 Corporate Energy Targets of PJSC Gazprom
No. Target Energy Performance Indicator (EPI), unit of measurement EPI values
Reference period, 2018 Target period, 2020 Target period, 2021 Target period, 2022
1. Improve the energy efficiency of PJSC Gazprom’s business operations Reduce specific consumption of fuel and energy resources in production activities 100 % –1.2 % –1.2 % –1.2 %
2. Save fuel and energy resources in natural gas production, transportation, underground storage, processing, and distribution Natural gas savings, mcm 2,951.9 2,096.8 4,182.5 6,306.4
Electric power savings, million kWh 364.2 221.2 407.8 613.7
Heat energy savings, thousand Gcal 235.9 158.2 295.4 428.1
3. Develop, implement, prepare for certification, maintain and improve PJSC Gazprom’s Energy Management System (EnMS) in line with ISO 50001:2018 Certification of conformity within the scope and perimeter of PJSC Gazprom’s EnMS (international certificate) No certificate. Certificate obtained in line with the EnMS scope and perimeter. Certificate confirmed in line with the EnMS scope and perimeter. Certificate confirmed in line with the EnMS scope and perimeter.

Energy Intensity

GRI 302-3

PJSC Gazprom assesses the energy intensity of its process operations through specific energy consumption, which is defined as the ratio of total energy resources consumption converted into reference fuel (tons of reference fuel) to the work being performed. Since production processes vary significantly across PJSC Gazprom subsidiaries involved in gas production, transportation, underground storage, processing, and distribution, as well as the Gazprom Group companies, each business activity requires an individual approach when setting energy intensity indicators, making it impossible to consolidate them into a single indicator either for PJSC Gazprom or the Gazprom Group.

Energy intensity in gas production, transportation, and underground storage is measured using natural gas and electric power consumption for internal process needs, while in gas and liquid hydrocarbons processing it factors in consumption of gas, electric power and heat energy.

The output is expressed in volumes of gas produced (thousand m3) in gas production, volumes of gas transported (mcm•km) in gas transportation, total volumes of gas withdrawn and injected (thousand m3) in underground gas storage, volumes of gaseous and liquid hydrocarbons processed (tons of reference fuel) in gas processing.

Decline in specific consumption of natural gas for internal process needs during transportation
The target for 2011–2020 is at least 11.4% (compared to the level of 2011).
The actual reduction in 2011–2019 was 22.0%.
Target achieved.

Energy intensity of the core activities of PJSC Gazprom, 2016–2019
Activity 2016 2017 2018 2019
Gas production, kg of reference fuel per thousand m3 17.79 17.95 18.99 19.99
Gas transportation, kg of reference fuel per mcm•km 26.30 27.30 27.86 26.97
Underground gas storage, kg of reference fuel per thousand m3 5.68 7.15 6.91 8.20
Gas processing, kg of reference fuel per ton of reference fuel 45.91 46.99 50.52 50.53

In gas transportation, specific energy consumption went down by 3.2% as a result of a 1.4% reduction in the volumes of gas transported, as well as due to the measures taken under the energy saving program. In underground gas storage, specific energy consumption increased due to the fluctuations in natural gas demand that required utilization of energy-consuming equipment and a higher consumption of fuel gas. In natural gas production, energy intensity rose on the back of a higher consumption of gas as an energy source at the fields in the Nadym-Pur-Taz Region. Production volumes started falling across the majority of the region’s fields, resulting in a higher energy consumption for subsequent natural gas compressing.

Energy intensity is calculated on the basis of the energy consumption within PJSC Gazprom.

Gazprom Neft’s Downstream Division achieved an energy intensity ratio of 134 kg of reference fuel per ton in relation to its goods (energy used per unit of goods).

Energy intensity across the Downstream Division of Gazprom Neft, 2016–2019
Indicator 2016 2017 2018 2019
Energy intensity ratio
based on goods (energy used per unit of goods), kg of reference fuel per ton 137 143 145 134
Metric (denominator) used to calculate the ratio
output, mmt 49 48 50 49
Energy types included in the energy intensity ratio
fuel 83 85 87 79
electricity 25 24 24 24
steam 33 34 34 32
Figures are based on the energy consumption within the organization.

In 2019, Gazprom Energoholding’s energy intensity was 1.67.

Energy intensity of Gazprom Energoholding’s companies, 2016–2019
Indicator Unit 2016 2017 2018 2019
Power plant busbar output (other than HPPs) million kWh 130,801 126,944 124,068 121,919
Productive supply of heat energy to end customers (net of intercompany balances) thousand Gcal 119,119 116,276 119,048 110,749
Reference fuel consumption at sources thousand tons of reference fuel 56,863 55,066 54,085 51,586
Third-party heat energy procurement thousand Gcal 4,105 3,259 3,791 3,322
Electric power consumption at boiler houses million kWh 522 572 556 510
Electric power consumption at heat networks million kWh 946 969 954 971
Power output by hydro generators at HPPs million kWh 12,863 13,686 12,819 11,674
Busbar output at HPPs million kWh 12,775 13,595 12,730 11,585
Energy intensity of TPPs 1.74 1.73 1.70 1.70
Energy intensity of HPPs 1.12 1.12 1.12 1.12
Total energy intensity 1.71 1.70 1.67 1.67

The energy intensity of Gazprom Energoholding’s companies is defined as the ratio of fuel consumption at power plants and boiler houses of the subsidiaries, heat energy supplied to the subsidiaries’ networks by third parties, electric power consumed at boiler houses and heat networks facilities of the subsidiaries to the total busbar output of the power plants and heat energy supply to end customers (all intragroup balances of heat energy are excluded).

The energy intensity of HPPs is defined as the ratio of electric power generated multiplied by the average efficiency ratio of hydroturbine units (assumed at 0.9) to HPP busbar output.

Gazprom Neftekhim Salavat does not calculate energy intensity ratio.

Renewable and Secondary Energy Resources

11,703,055 MWh

of electric power was generated by the Gazprom Group using renewable and secondary energy resources in 2019

RUB 3.44 billion

was invested by the Gazprom Group in renewable and secondary energy resources in 2019

GRI OG 2

The Gazprom Group relies on alternative energy sources wherever it is economically and technically feasible, particularly in remote or technologically isolated areas.

The Gazprom Group uses renewable energy resources and secondary energy resources to generate energy for internal needs and for sale to third-party consumers. Solar and wind generators, as well as gas flow heat and energy power converters are widely used at production facilities, gas trunkline facilities, and gas distribution networks for ensuring, inter alia, routine power supply to telemetry systems, electrochemical protection of pipelines, lighting, etc.

Depending on energy consumption modes, standalone complete renewable energy resources-based power units can be effectively used to supply power to various process facilities of PJSC Gazprom. These include automatic environmental monitoring stations, rust protection systems, warning lighting at communications towers and power line supports, lighting systems of helicopter pads, block valve stations, communications equipment, small-scale gas distribution stations, etc.

In terms of heat and power generation, secondary energy resources have a huge energy-saving potential as their use helps reduce the consumption of primary energy resources.

Power generation from renewable and secondary energy resources at the Gazprom Group, MWh, 2016–2019

In 2019, the Omsk Refinery completed the construction of a 1 MW solar power plant (the first phase of the project). The new station covers an area of 2.5 hectares and consists of 2,500 solar panels manufactured by Hevel, a Russian company. This investment project introducing green energy technologies is unique to the Russian industry and forms part of a large-scale program for the development of the Omsk Refinery.

This pilot facility fully supplies electricity to all administrative buildings of the Omsk Refinery, including a single amenity building for 2,600 employees. Based on the results of inspections and measurements, a decision will be made on the construction of a 20 MW solar power plant at the Omsk Refinery which is planned for 2021.

In 2019, PJSC TGC-1 (Gazprom Energoholding) and Nugush Hydroengineering Complex LLC (Gazprom Neftekhim Salavat) produced 11.70 billion kWh of electric power by means of hydrogenation. The HPPs of PJSC TGC-1 account for the bulk of power generation and contribute significantly to the green energy of the Northwestern Federal District of Russia.

Gazprom Energoholding (PJSC TGC-1) plans to put into operation 100 MW of renewable energy resources in 2023–2025.

In 2019, the Gazprom Group operated 2,240 secondary energy resources- and renewable energy resources-based power generation units (other than hydroelectric units) such as turbo expanders, thermoelectric generators, solar modules and batteries, and wind turbines. The total electric power generated by these power units amounted to 686,200 kWh.

For the total amount of renewable energy generated by source see Appendix

Promotion of NGV Fuel

The development of the NGV fuel market in Russia is one of the most important sustainable development projects run by PJSC Gazprom. Thanks to the environmental friendliness of methane, the use of natural gas as a motor fuel instead of gasoline and diesel fuel offers a number of positive effects on the quality of life.

Conversion of vehicles to natural gas helps significantly reduce emissions both during the utilization of fuel and along the entire production chain. From production to refilling, CNG generates four times less GHG emissions than conventional petroleum motor fuels. According to the estimates, if 50% of vehicles are converted to natural gas, GHG emissions will go down by 65 mmt of СO2 per year.

Most importantly, natural gas does not generate emissions of solid soot particulates that are extremely detrimental to human health. Thus, the use of methane as a motor fuel improves the urban environment and has a positive effect on the health condition of the population.

PJSC Gazprom pursues the long-term goals of the NGV fuel market development in Russia in cooperation with other market players and industry NGOs such as the National Gas Vehicle Association which brings together over 120 participants of the Russian NGV fuel market with a view to promoting the use of natural gas as motor fuel and shaping a consolidated position on its development.

In 2019, the Gazprom Group’s representatives took an active part in events related to the NGV fuel market. The Group also helped establish discussion platforms dedicated to proactively addressing the most urgent market issues.

Backed by PJSC Gazprom, the National Gas Vehicle Association publishes the Alternative Fuel Transport, an international scientific and technical journal which is the only printed and online source in the CIS offering research and analysis information on the NGV fuel market development and the only publication devoted to alternative fuel transport technologies which is included in the list of the leading peer-reviewed scholarly journals and publications of the Higher Attestation Commission of the Russian Ministry of Science and Higher Education.

Gazprom’s Risks and Opportunities due to Climate Change

GRI 201-2GRI 102-15

In accordance with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), PJSC Gazprom voluntarily identifies and evaluates climate-related risks in two key areas:

  • risks related to the transition to a low-carbon development scenario (transition risks);
  • risks related to physical changes in the environment due to climate changes (physical risks).

Risk assessment covers three time periods: short-term (up to 1 year), medium-term (from 1 to 3 years), and long-term (from 3 to 10 years and more). Risk assessment is performed at the level of both the Company in general and its subsidiaries. Information is published on the CDP platform, in environmental reports and sustainable development reports. The scenario analysis also recommended by the TCFD relies on simulations to assess the impact of various climate factors on the future financial performance.

In 2019, the Group developed the draft Program for adaptation of PJSC Gazprom’s operational activities to changing climatic and geocryological conditions taking into account probable scenarios of climate changes in the areas where Company’s facilities are located. Risk assessment was performed in cooperation with the institutions of the Russian Academy of Sciences (RAS), such as the Institute of Environmental Geoscience of RAS, the Institute of Petroleum Geology and Geophysics of RAS, etc. The results of this work are based on the analysis of accumulated and new data obtained using hi-tech tools. They helped to identify regularities in natural and industrial evolution of the permafrost soils, classify territories according to geocryological hazards, and optimize the design of structures and costs of their engineering protection. Moreover, coupled thermo-mechanical calculation methods at different levels of synthesis were developed. The geotechnical monitoring system was improved with the help of the national instrumental base. The conducted investigations contributed to the development of comprehensive measures on adapting Gazprom’s operating activities to changing climatic and geocryological conditions, including regulatory, methodological, technological, informational and administrative aspects.

The Gazprom Group companies implement a set of measures to minimize the negative climate change consequences for its production activities, including:

  • climate change assessment in the areas where the Group’s process facilities are located;
  • regular monitoring of machinery and equipment, as well as predictability assessment of the production processes in the areas susceptible to climate change impacts;
  • use of extra-durable pipe products in the areas susceptible to climate change impacts;
  • construction of sheltered compressor shops in the areas with adverse weather and climate conditions;
  • construction of backup power supply plants at the gas production facilities located in the permafrost areas;
  • development of projects for the construction of gas production facilities with due consideration of weather and climate conditions;
  • laying pipelines deeper into the ground at their landfall sections to ensure protection of their offshore segments;
  • management of geocryological conditions within the construction area during the pre-development of fields in the Yamal Peninsula to ensure reliability of foundations and base structures using advanced temperature-stabilizing technical aids for permafrost soils, with adjustment made for perennial warming;
  • development of comprehensive insurance schemes covering the Group’s environmental risks, including compensation for environmental damage.

In 2019, PJSC Gazprom also started developing its sustainable development scenarios through 2050, taking into account the global shift to a low-carbon economy.

 

For more details on Gazprom’s risks and opportunities due to climate change see Pages 52–53, PJSC Gazprom Environmental Report 2019