GM&T signs agreement with Volga Gas to develop CO2 emission reduction projects
On 28 April 2021, Gazprom Marketing & Trading (GM&T) and Volga Gas plc signed an Upstream Emissions Reduction rights purchase agreement, to develop CO2 emission reduction projects in the Russian oil and gas sector.
This follows a previously signed strategic Memorandum of Understanding to jointly pursue possibilities in the Russian oil and gas market. During the first stage of the agreement, GM&T will develop emission reduction projects at the assets owned by Volga Gas, to satisfy the demand for carbon credits from its European customer base.
Volga Gas is also pursuing an ambitious development program to support Russian oil and gas companies to reduce associated petroleum gas (APG) flaring, through its expertise and proprietary engineering solutions.
The aim of this collaboration focuses on bringing additional financing to reduce APG flaring across the oil and gas production sector in the Russia Federation. This will reduce the exposure of Russian companies to the European Union (EU) carbon border adjustment mechanism planned for the future.
Julia Elmgren, Head of Environmental Products, said: “Our collaboration with Volga gas is a great example of how carbon financing can create new and real emission reductions. As a country, Russia has vast natural resources and also the potential to act as an increasingly large carbon sink. As the rules governing international trading of emissions continue to develop, we see carbon markets playing an increasing role in Russia and we are delighted to be playing a central role in this growth.
Andrey Zozulya, CEO of Volga Gas also added: “We see huge potential in converting APG that is currently being flared into useful products such as dry gas or liquified natural gas (LNG), natural gas liquids (NGL) and condensate. Additional carbon financing is what is required to boost our activities in this respect, and we are very enthusiastic about getting this financing through GM&T”.
Volga Gas is an independent oil and gas and engineering company, engaged in geological exploration and production of oil, gas and gas condensate in the Saratov and Volgograd regions, as well as the Republic of Bashkortostan. Volga Gas own five licenses in the Volga region and carry out prospecting and exploration work, as well as extracting oil, natural gas and gas condensate. Volga Gas has the technical expertise to help third party oil and gas producers with solutions to increase the efficiency of oil and gas production while simultaneously decreasing CO2 emissions.
GM&T has been active in emissions markets since 2008. Through its 10-member strong team, the desk develops emission reduction projects globally and provides services and products to support customers with their emission exposures and reduction goals.
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