Russian shelf: Source of crude or stimulus for innovation?

Russia’s Federal Agency for Mineral Resources forecasts the discovery of large deposits of hydrocarbon in the south of Kara Sea. This concerns gas, gas condensate and oil and gas condensate deposits. Work on the shelf is very expensive and quite complicated, but there is no alternative.

According to experts, the interest of energy producers in Russia and the rest of the world is shifting to sea beds. Hydrocarbon deposits on land are becoming less accessible, according to Konstantin Simonov, director of the National Energy Security Fund.

“Mankind is shifting to water in its strive for getting a necessary amount of fuel and gas,” Simonov says. “The shelf and oceans will be the future territories where oil and gas will be produced. Russia will enter the shelf in the near future. Russia has nowhere to go because the production of oil and gas is falling in west Siberia."

The Russian Arctic shelf has huge deposits, but it is very difficult to develop them due to severe natural conditions and the remoteness of deposits from the coast as well as lack of experience. During Soviet times, oil and gas were produced only on the land. No wonder that Russia’s Gazprom and Rosneft companies that enjoy the right to develop deposits on the Russian shelf are actively forming a pool of foreign partners who have experience and technology.

Boris Tumanyan, Professor at Gubkin Oil and Gas Institute, believes that the development of shelf is a promising trend but it is something of remote future. “The development of shelf is very expensive and complicated,” Tumanyan says. “The shelf is a very difficult place from the standpoint of ecology. There is a need to take serious measures to protect the environment and assure technological safety. I believe that intensive commercial development will take for decades. But I do not think that this will happen in the next decade.”

The professor emphasized that the development of the sea bed should be carried out intensively. Russia should not lag behind its competitors and developments conducted abroad.  According to Tumanyan, there are urgent issues that have to be solved without delay. There are many problems on the land too.

“Russia has many deposits, especially gas deposits where gas should be extracted in full,” Tumanyan says.  “A large volume of gas is burned and utilized. East Siberia is a huge territory for the search of new deposits, and they should be developed. Russia should work there now. This is simpler and it will take less time.”

Historical experience shows that all those who started developing sea bed deposits faced difficulties. Brazilian oil producers learned to drill ultra-deep wells, Norwegians built artificial islands in the Barents Sea to refine oil produced there. That’s that. The world is entering an era of expensive hydrocarbons, said Konstantin Simonov. This will give an impetus to the development of allied sectors of the economy.

The Russian authorities have more than once described the energy complex as the main consumer of innovations. Experts do not exclude that it will be the driving force in the innovative economy.

First published in The Voice of Russia.

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