USSR: DEVELOPMENT OF THE GAS INDUSTRY

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• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80T00702A000100060007-7
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 91
• Document Creation Date: December 12, 2016
• Document Release Date: June 24, 2002
• Sequence Number: 7
• Publication Date: July 1, 1978
• Content Type: PAPER

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Assessment
Center
USSR: Development of
the Gas Industry
ER 78-10393
July 1978
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USSR: Development of the Gas Industry
Central Intelligence Agency
National Foreign Assessment Center
Key Judgments
Soviet natural gas production will continue to grow rapidly and to
provide the USSR with a growing source of energy for domestic use or export
through the 1980s.
? Soviet natural gas reserves of 28 trillion cubic meters (cu m) are
possibly the world's largest and would provide more than 80 years
output at the 1977 production level of 346 billion cu m per year.
? Gas extraction grew from 12 billion cu m in 1956 to 346 billion cu m in
1977, an impressive average annual rate of 17 percent, and should
continue to grow at about 6 percent a year into the 1980s, reaching 415
billion to 420 billion cu m in 1980, 560 billion to 600 billion cu.m in
1985, and possibly more than 700 billion cu m by 1990.
? The Soviet gas trunkline system now extends well over 100,000
kilometers (km), linking major gasfields in West Siberia and Central
Asia with Soviet and European consumers. Although the Soviets do not
yet possess a gas distribution system capable of satisfying all consumer
needs year-round, they have made some progess in that direction.
? Natural gas will become an increasingly important hard currency
earner for the Soviets in trade with the West. It already is a major
factor in the Soviets' position as chief energy supplier to Eastern
Europe.
? Gas will contribute more than any other fuel to increments in total
Soviet energy production between now and 1990. By 1990 it could
constitute the largest.single source of domestically produced energy.
Development of the Soviet gas industry through the 1980s will focus on
West Siberia.
? Gas production at older fields in the European USSR has begun to
decline fairly steeply and growth in Central Asia has slowed.
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? West Siberia's northern Tyumen' Oblast holds over two-thirds of
Soviet gas reserves, and new discoveries are continuing to add to the
region's reserves.
? Present Soviet plans call for West Siberian gas production to increase
from 68 billion cu m in 1977 to more than 150 billion cu m in 1980.
? The region will account for up to 80 percent of all additions to Soviet
gas production during 1976-80 and will provide virtually all increases
in output in the 1980s.
Several persistent problems will confront the Soviet gas industry in the
next decade, restraining growth in output and raising costs of gas extraction
and transport.
? Pipeline capacity has continually lagged behind drilling and has caused
the gas industry to fail to fulfill annual and five-year plans. It probably
will be responsible for below-plan production in 1980.
? Inadequate compressor power is a principal bottleneck in expansion of
pipeline capacity and will remain so at least through 1980. Construct-
ing pipelines in permafrost has also required increased time plus
greater investment-particularly in Western large-diameter pipe-
and the costs of gas transport are rising substantially.
? Gas extraction costs, already rising faster than those of any other
Soviet energy industry, will continue to grow markedly. Increasing well
depths-particularly in older producing regions-are a major cause, as
are the high costs of gasfield development in the Siberian arctic.
? West Siberia's northern Tyumen' Oblast will become the source of
most of the gas industry's future problems as well as the base for
production growth. Inadequate infrastructure and technical difficulties
posed by drilling, pipe-laying, and pipeline operation in the severe
climate probably will limit the development pace.
? The older fields in the European USSR and Central Asia will become
an increasing drag on national gas production, absorbing a continued
high level of investment while output stagnates or declines.
? Soviet shortcomings in production of large-diameter gas pipe, com-
pressor stations, and exploration, drilling, gas processing, and other
equipment will lead to continued Soviet dependence on imports from
the West.
Natural gas will not prove a panacea for Soviet energy problems caused
by a future decline in oil production.
? Gas will prove difficult to substitute for oil in several sectors of the
Soviet economy, particularly agriculture and transportation. Gas con-
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sumption will continue to grow in industry, where its use is already
substantial. Electric power generation will also provide a significant
area of gas-for-oil substitution in the early 1980s.
? Gas will not match oil as a hard currency earner by 1980, although it
probably will become the leading Soviet trade commodity well before
1985, earning several billion dollars a year.
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Key Judgments ........................................................................................ i
Introduction ................................................................................................ 1
1. Postwar Development ............................................................................ 1
A. Early Development ........................................................................ 2
B. Take-Off in Growth ........................................................................ 2
C. Investment ...................................................................................... 3
D. Trends in Use ................................................................................ 5
II. Reserves ................................................................................................ 6
A. Growth of Reserves ........................................................................ 6
B. Geographic Shift .............................................................................. 7
C. Reserve Characteristics .................................................................. 8
D. Emerging Problems in Expanding Reserves .................................. 9
E. New Regions .................................................................................. 10
III. Production .......................................................................................... 12
A. Growth in the East; Decline in the West ....................................... 12
1. Recent Trends ............................................................................ 12
2. Future Growth ............................................................................ 12
B. Increased Costs ................................................................................ 14
IV. The Gas Distribution System ............................................................ 17
A. Current Status ................................................................................ 17
B. Pipeline Construction Problems .................................................... 19
V. Trade .................................................................................................... 20
A. Exports .............................................................................................. 21
B. Imports .............................................................................................. 23
VI. The Need for Western Assistance ..................................................... 23
A. Pipelines ............................................................................................ 23
B. Compressor Stations ......................................................................... 24
C. Gas Processing ................................................................................ 24
D. Well Drilling and Completion ........................................................ 24
E. Exploration ........................................................................................ 24
F. Offshore ............................................................................................ 24
VII. Prospects ............................................................................................ 25
A. The Tenth Five-Year Plan (1976-80) ............................................ 25
B. The 1980s ......................................................................................... 26
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C. Continuation of Rising Costs .......................................................... 27
D. Reliance on the West ...................................................................... 27
E. Stepped-Up Campaign .................................................................... 28
F. Not a Panacea .................................................................................. 28
Appendixes
A. The Older Fields .................................................................................. 31
B. Central Asia ........................................................................................ 35
C. West Siberia ...................................................................................... 39
D. Gas Processing and Refining .............................................................. 47
E. Gas Storage .......................................................................................... 51
F. The Orenburg Project ........................................................................ 53
G. The Trilateral Trade Agreement ........................................................ 55
H. Liquefied Natural Gas ........................................................................ 57
I. USSR: Major Natural Gas Pipelines .............................................. 59
J. Statistical Tables ................................................................................ 63
K. Source References .....
................................ ......................................... 81
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USSR: Development of the Gas Industry
Introduction
Soviet natural gas production until recently
has drawn much less attention than Soviet pro-
duction of oil, which currently constitutes 45
percent of domestic fuel output versus 24 percent
for gas and 28 percent for coal. Natural gas,
however, is the most dynamic sector of Soviet
fuel production. Oil production faces serious
problems stemming primarily from (a) declining
output in the once-prolific Urals-Volga region in
the European USSR and (b) peaking production
at the largest oilfields in West Siberia. No other
large Soviet oil deposits have been discovered in
several years, and recent CIA studies have pro-
jected a decline in oil production sometime in the
next few years. The Soviet gas industry, on the
other hand, has grown rapidly-despite its re-
peated failure to meet plan goals-to become
second only to that of the United States. Its
impressive capacity for continued expansion sug-
gests that its importance to both, foreign and
domestic consumers will eventually approach
that of oil.
This paper is intended to provide a comprehen-
sive reference work to facilitate evaluation of the
gas industry's current performance and its pros-
pects for growth during the next few years.
Section I provides an overview of the gas indus-
try's postwar development, discussing investment
trends in the industry and utilization of gas by
other economic sectors. Section II discusses the
current status of Soviet gas reserves and the
prospects for future additions. The rising impor-
tance of West Siberia to future increases in gas
output is the focus of Section III. The progress
and problems of the Soviets' massive gas pipeline
system are discussed in Section IV. Section V
covers the growth of Soviet gas exports to East-
ern and Western Europe and imports from the
Middle East. Section VI surveys the Soviet gas
industry's current and future needs for Western
equipment. Section VII evaluates the gas indus-
try's prospects through the 1980s, focusing on
obstacles to rapid growth in production, rising
industry costs, and the likely role of gas in Soviet
domestic energy consumption and foreign energy
trade.
This paper is the third in a series of studies on
the Soviet energy industry. It follows Prospects
for Soviet Oil Production, ER 77-10270 (April
1977), and Prospects for Soviet Oil Production:
A Supplemental Analysis, ER 77-10425 (July
1977).
The term "gas industry" will refer to the
activities of the several ministries involved in the
different phases of gas exploration, extraction,
and transport. Although the Ministry of the Gas
Industry is the principal government agency
involved in Soviet gas production, the Ministry of
the Petroleum Industry is responsible for a large
portion of annual gas extraction-18 percent in
1977. The Ministry of Geology and the Ministry
of Construction of Petroleum and Gas Industry
Enterprises also have considerable responsibility
for gas industry operations.
1. Postwar Development
The Soviet gas industry was largely neglected
until the mid-1950s. Before World War II, gas
played only a small role in energy supplies-
mainly as a local fuel in the oil producing
regions. After the war, the USSR concentrated
on restoring coal and oil production and infra-
structure in European Russia. Spurred by the
discovery of large gas deposits in the early 1950s,
however, gas output grew very rapidly after
1955, growing as a share in total supplies from
2 percent in 1955 to 24 percent in 1977 (see
figure 1 and table J-5). Soviet planners reason-
ably expect the industry to achieve an increasing
share by maintaining a substantial growth rate
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during the balance of the Tenth Five-Year Plan
(1976-80) and beyond.'
A. Early Development
As in the case of other major world producers,
the USSR was slow to expand its gas industry.
The Soviets were unaware of their vast natural
gas resources until after World War 11.[11 Ini-
tially, production was limited primarily to associ-
ated gas recovered in conjunction with oil
production in the Trans-Caucasus oilfields. Only
toward the late thirties did the industry open its
first Ukrainian natural gasfields and construct
its first long-distance trunklines. Output re-
mained small-hampered by German occupation
during the war (see table J-1 Z)-and not until
the midfifties did nonassociated natural gas con-
stitute the bulk of Soviet gas production. The
Soviets were reluctant to risk much capital
exploring for a fuel which included uncertain
reserves and which at that time was more dan-
gerous and expensive to exploit than oil. Gas
discoveries were usually the unexpected result of
oil exploration; they generally proved small and,
therefore, were often not developed. However,
when, together with improved extraction and
transport technologies, major Ukrainian natural
gas discoveries were made in the early fifties,
such obstacles were reduced.
B. Take-Off in Growth
Following the large Ukrainian gasfield discov-
eries, the jump in gas output and reserves proved
dramatic (see figure 2 and tables J-2 and J-9).
Average annual growth in production during
1956-77 was 18 percent, compared with 12 per-
cent-computed from a smaller base-in the
previous 25 years. Growth in gas extraction
proceeded at a rate higher than that for crude oil
production in all five-year periods after 1955 (see
table 1). By the early seventies, USSR output
was surpassed only by the United States. [2] As a
' Because CIA anticipates an absolute decline in oil output, its
projections for production of oil and alternative fuels for 1978-85
show gas exceeding oil by a wide margin by 1985. For a detailed
discussion of Soviet oil production problems, see CIA publication
Prospects for Soviet Oil Production, ER: 77-10270 (April 1977),
and Prospects for Soviet Oil Production: A Supplemental Analysis,
ER 77-10425 (July 1977).
2 Appendix J consists of 27 statistical tables.
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USSR:
Share of Major Fuels
in Total Fuel Production
Percent
65
Table 1
GAS
1951-75 ...................................... 16.9 10.8
1951-55 .................................. 9.2 13.3
1956-60 ......................... ........ 38.2 15.9
1961-65 .................................. 23.0 10.4
1966-70 ... .............................. 9.2 7.7
1971-75 .................................. 7.9 6.8
1976-80 Plan ............................ 8.5 5.5
1976 ........................................ 10.8 5.9
1977 ........................................ 7.8 5.1
'Average annual rates of growth
28 trillion cu m. Pipeline transport capacity has
similarly expanded at a steady-although below-
plan-pace.
Growth in both reserves and production has
relied principally on a few fields.[3] Discovery
and fairly rapid development of the North
Stavropol' (North Caucasus) and Shebelinka
(Ukraine) fields in the midfifties sparked and
maintained early output increases; addition of a
number of other large fields-especially Uzbek's
Gazli-supported further expansion into the
midsixties (see table 2)?. Thirteen fields during
1956-65 accounted for 56 percent of national
production and approximately 40 percent of re-
serves. Shebelinka and North Stavropol' alone
provided 30 percent of total output. Athough the
Soviets currently are producing gas from more
than 300 fields[4]-with more than 5,000 exploi-
tation wells[5]- they are still relying on a few
major fields, particularly in West Siberia, to
provide most growth in output in the eighties. [6]
oLiiI II:iii fill II I II Iii
1955 60 65 70 75 77
576394 7.78
Investment in the gas industry grew slowly
from 1946 through the early sixties but increased
rapidly thereafter (see table 3), outpacing invest-
ment in other energy sectors during 1966-76 (see
table 4). As a result, while the oil sector still
consumes the largest portion of total annual
result of increased exploration, gas reserves investment in Soviet energy industries (roughly
(proved and probable) increased more than 40 35 percent in 1976), the share of gas has risen
times during the 1956-76 period, averaging an from 10 percent in 1965 to 17 percent in 1976.
estimated yearly growth of 19 percent to reach The value of the stock of plant and equipment in
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First Year
of Production
Shebelinskoye .................................. 1956
North Stavropol'skoye .................... 1956
IGazli ................................................ 1961
Ugerskoye ........................................ 1946
Karadag .......................................... 1956
iStepnovskoye .................................. 1958
Leningradskoye ............................. 1958
Bilche-Volitskoye ............................ 1949
Rudkovskoye .................................. 1957
jKorobkovskoye ................................ 1961
Maikopskoye .................................... 1960
iBerezanskoye .................................. 1963
Staro-Minskoye ................................ 1961
Initial Reserves
(A + B + C1) 2
Cumulative
Production
402.3
104.1
223.4
70.9
480.0
25.7
36.8
25.0
34.1
23.9
27.6
17.6
57.6
14.9
41.0
14.8
32.1
13.5
89.7
11.6
94.9
10.7
61.0
9.6
33.6
8.6
Source: fain F. Elliot, The Soviet Energy Balance, New York (1974), p. 18.
2 Including:
Category A: reserves of those deposits on which detailed information is available from a network of
wells completely covering each area.
Category B: reserves of those deposits on which information is available from a minimum of three
ells yielding "commercial" flows of gas.
Category C : (a) reserves of newly discovered deposits on which information is available from two or
more wells yielding commercial flows of gas and (b) reserves presumed to exist in parts of structures directly
djacent to those with higher category (A + B) reserves.
The A + B + C, figures refer only to natural gas reserves and do not include reserves of associated gas
gas extracted along with oil). It is uncertain whether published data for A + B + C, reserves include only
hose that are economically exploitable with current technology ("balansoviye" reserves), but available
vidence suggests that generally they do.
Soviet and Western reserve concepts differ. Soviet A reserves plus some portion of adjacent B reserves
orrespond to the US "proved reserves" category. The remainder of B reserves and some fraction of the C,
eserves fall into the US "probable" classification. Most of the remainder of the C, reserves fall into the US
`possible" category.
Capital Investment in the Ministry of the Gas Industry
Billion 1955 Rubles
1946-50 ........... :........... ...................
1951-55 .........................................
1956-60 ...........................................
1961-65 ........... :..............................
1966-70 ........... ..............................
1971-75 ...........................................
1976-80 2 .....................................
0.1
0.4
1.5
3.2
4.0
10.9
19.0
' Including i 4vestment for pipeline construction. Sources: Review
of Sino-Soviet 4it (March 1969), P. 10; Gazovaya promyshlennost'
no. 11, (1976), . 12.
2 Plan.
Table 4
Capital Investment' in Energy Industries
Index: 1965=100
Industry 1965 1970 1975 1976
Electricity 2 .................... 100 1.23 149 153
Coal ................................ 100 1.28 124 129
Oil 2 ................................ 100 1.22 186 202
293 306
' Investment flows of reproducible fixed assets expressed in
constant 1973 prices. Source: Narodnoye khozyaystvo (1975), p. 508;
(1976), p. 438.
2 Including investment in all forms of electric power generation.
Does not include investment in pipeline transport. Inclusion of
such investment would have boosted the index shown above.
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Growth of Fixed Capital ' in the Fuel Sector
Percent'
Total fuels' ............................. 7.3 73 7.4
Gas industry' 25.0 15.1 21.0
' In constant 1973 prices gross of depreciation. Source: Narodnoye
khozyaystvo, various issues.
' Average annual rates of growth.
Excluding electric power and oil and gas pipelines.
' Ministry of the Gas Industry. Excluding gas pipelines.
the Ministry of the Gas Industry (which ac-
counts for most of the fixed capital stock of the
gas industry) similarly has climbed steadily (see
tables 5 and J-4). By 1976, the Ministry's stock
of reproducible fixed assets had reached 14
billion rubles[7]-only 30 percent less than that
for the oil industry.[8] As expected, because of
very long transmission distances to consumers,
pipeline construction has taken the bulk of in-
vestment allocations (see tables J-3 and J-4).
D. Trends in Use
Reflecting the rising share of gas diverted to
exports, national consumption of gas has climbed
more slowly than production (see table J-6).
Although the earlier exceptionally high growth
rates of domestic gas use have declined (see table
6), the absolute volume has increased by 1,000
percent over that of the late fifties.
Meanwhile, the trends of regional and sector
consumption have been generally upward (see
tables J-7 and J-8). Industry has received more
than one-half of the annual output of gas, with
consumption concentrated in the traditional in-
dustrial centers of the European USSR. The
more remote eastern areas are now using a larger
share of the gas they produce, which reduces the
proportion of their output available for transmis-
sion elsewhere. The growth in use of gas as
industrial boiler and furnace fuels in West Sibe-
ria, Central Asia, and the Urals reflects this
trend (see table J-9).
The major sectoral development has involved a
decline in the shares of gas consumed by electric
Table 6
Natural Gas Consumption'
1961-75 ......... ......._........................_....,.._,....,.._............... 13.0
1961-65 ........................................................................... 23.1
1966-70 ........................................................................... 9.3
1971-75 ............................................................................ 7.3
1976 ................................_....................................._ ....,...... 8.6
1977 .................................................................................... 6.4
' Apparent consumption. Sources: Narodnoye khozyaystvo SSSR
and Vneshnyaya torgovlya SSSR, various issues. CIA estimates for
1976-77.
' Average annual rates of growth.
power plants 3 and the oil and gas industry, 4 and
a substantial rise in the share of gas absorbed by
the metallurgical and chemical industries. [9]
That shift reflects both a Soviet effort to increase
the use of gas as a raw material rather than as a
fuel and the development of new production
technologies. Although lagging greatly behind
the developed West in adapting the use of gas for
heavy industrial purposes, the USSR in the past
decade has considerably increased the use of gas
in such areas as the petrochemicals industry (for
example, in ammonia production) and in gas
converters for steel production. S Gas use by
electric power plants may also have grown more
slowly because of reduced need for buffer sup-
plies of gas for handling peak demand periods in
winter.
The share of gas supplies devoted to household
consumption has increased only slightly. 6 With
installation of extensive urban distribution sys-
tems both technically difficult and expensive, the
Soviets have given priority to large-diameter
transmission pipelines leading to large industrial
' The actual amount of gas consumed by electric power genera-
tion has, nonetheless, grown substantially.
' Recent evidence does indicate, however, that gas use by the gas
industry itself, notably for operating gas turbine compressor units
on major gas pipelines, is climbing and perhaps reached 30 billion
cu m by 1977-9 percent of total production. (Gazovaya promysh-
lennost', no. 4 (1977), p. 6).
' Although use of gas in electric power generation grew by 600
percent during 1958-75, its share of national consumption has
fallen by 11 percent. Reflecting the very rapid expansion of gas as a
raw material, use in the chemical industry-notably for ammonia
production-has increased 75 times, and use of gas in metallurgy
has risen 23 times.
6 Precise determination of household consumption is difficult,
because of extensive use by urban apartments of byproduct heat
from gas-burning heat-electricity plants.
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consumers arjd electric power plants that produce
both space heat and electricity.
II. Reserves
USSR: Gas Reserves*
T
ll
ion
ri
Soviet gas production's postwar growth has Cubic Meters
been based on (a) the large size of the country's 30 r-'
gas reserves and their fairly rapid development
and (b) the shift in exploitation from the dwin-
dling reserves of the European USSR to the
more recently discovered reserves of Central
Asia and West Siberia.
Discovered gas reserves have increased dra-
matically sine the midsixties. In 1961, only 239
gas or gas condensate deposits were known to
exist; by 197 there were 650. [10] Growing at
an average annual rate of 20 percent, reserves in
Soviet catego ies A + B + C,' climbed from 3.6
trillion cu m in 1965 to 28 trillion cu m in 1976
[ 11 ] (see fig ire 3 and table J-10), giving the
Soviets, by th jr own account, the world's largest
gas reserves. Additions to proved and probable
reserves rose most sharply-by 35 percent per
year-during the last half of the sixties, when
many of the largest fields in Central Asia and
West Siberia were discovered. During 1971-76
the average a nual growth slowed to 10 percent.
Nevertheless, the ratio of reserves to production
for natural gas has improved dramatically. After
declining throughout the early sixties, the ratio
rose from a low of 28 in 1965 to a peak of 95 in
1973 (see table J-10).
For a descriptidn of coverage by reserve category see footnote 2
for table 2.
It is possible t~}at the Soviets have recently revised downward
their gas reserve estimate. Although Soviet data released in 1976
and 1977 indicate that reserves of 28 trillion cu m had been
reached, recent Soviet statements have failed to give a current
reserves estimate and suggest that the figure may be lower, perhaps
around 23 trillion u m. See Journal of Commerce, 5 June 1978,
p. 4. This paper wi use the estimate of 28 trillion cubic meters. As
noted above-foot ote to table 2-differences between Soviet and
Western concepts o reserves, moreover, complicate global compari-
sons; Persian Gulf reserves estimated under Soviet criteria would
probably prove mu h larger than the USSR's. In addition, Soviet
reserve estimates s ould be used with some caution, since unrealis-
tically high figures, have been noted in the past.
0 I A j 1 1 1 4 1 1 1 1 1( 1-
1955 60 65 70
" Corresponds very roughly to the Western reserve
categories of proved, probable, and possible.
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B. Geographic Shift
West Siberia has clearly emerged since the
late sixties as the leading source of future Soviet
gas production. [12] Paralleling developments in
crude oil, the share of total reserves of the old
European USSR gasfields-principally in the
North Caucasus (Stavropol' and Krasnodar'
Krays) and the Ukraine-has diminished rapidly
as a result of intensified extraction and the lack
Natural Gas Reserves (A + B + C,) of Selected Regions
as a Share of Total Soviet Reserves'
Ukraine
SSR
Krasnodar'
Kray
Stavropol'
Kray
Three-
Region
Total
40.6
0
15.4
56.1
21.5
10.9
32.6
64.9
24.7
16.3
11.3
52.3
18.4
13.0
6.6
38.0
5.1
0.6
1.3
7.0
3.9
1.1
0.8
5.7
' Percents are calculated from beginning of year data on reserves. Because of rounding, components may not add to the totals shown.
Source: A.D. Brentz, et. al., Ekonomika gazodobyvayushchey promyshlennosti, Moscow (1975), p. 25.
Urals region ........................................
North Caucasus ..................................
West Siberia ........................................
East Siberia ........................................
Far East .............................................
Ukraine SSR ..... .. _ .................................
Transcaucasus ..........................................
Central Asia ............................................
Volga region
RSFSR
Northwest region ...............................
of major new discoveries (see tables 7 and 8).
Meanwhile additions to reserves in West Sibe-
ria's Tyumen' Oblast and-to a lesser extent-in
Central Asia's Turkmen SSR and in the South-
ern Urals' Orenburg Oblast have been substan-
tial (see table J-11).9 The older fields held about
65 percent of proved plus probable reserves in
1956 but constituted a little less than 6 percent
.9 See appendixes A, B, and C for further details on the European
USSR, Central Asian, and West Siberian fields.
Percent of
Planned Actual Plan Fulfilled
Turkmen
Tyumen'
Orenburg
Three-
Region
SSR
Oblast
Oblast
Total
0
0
2.4
2.4
5.1
0.5
0.7
6.4
0.6
2.3
0.8
3.6
10.6
11.2
0.7
22.5
9.7
58.7
7.1
75.6
9.6
61.3
9.4
80.4
USSR .......................................................... 2,221
European section ............. ...................... 347
Asian section .......................................... 1,874
2,230.7 100.4
192.7 55.5
2,038.0 108.8
84 22.0 26.2
10 6.2 62.0
163 83.0 50.9
22 12.5 56.8
1,410 1,616.5 114.6
35 0 0
153 149.0 97.4
68 69.0 101.5
13 13.0 100.0
263 259.5 98.7
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by 1974. Res rves of the newer regions converse-
ly have grow from 2.4 percent of the national
total in 1951 o more than 80 percent in the mid-
1970s. The diverging trends in growth of reserves
in old and new producing regions are reflected in
widely differ nt ratios for reserves to production
(see table 9).
As in the midsixties, when six fields in the
European USSR 10 accounted for 48 percent of
national output, [13] growth in gas production
through the early eighties will rely primarily on a
handful of d posits. Northern Tyumen' Oblast
has provided most of the growth in the USSR's
reserves in the
During 1966
additions to t.
1977 held mi
serves. Eight 1
Yamburg, Za
Bovanenko, c
hold more tha
Combined wit
Orenburg fiel
60 percent c
Shatlyk, Med
tially develop,
initial prepar
Most reserve
probably will
Tyumen' OblE
ration current
past decade (see appendix Q. [ 14]
-77 it contributed 70 percent of
to A + B + CI categories and by
re than 60 percent of Soviet re-
lorthern Tyumen' fields-Urengoy,
polyarny, Medvezh'ye, Kharsavey,
emakov, and Neitinsk-together
n 80 percent of the region's reserves.
h the Shatlyk (Turkmen SSR) and
Is, they account for approximately
f Soviet reserves. Of these only
vezh'ye, and Orenburg are substan-
A. The remainder are undergoing
ation or are still being explored.
dditions through the early eighties
come from further discoveries on
M's Yamal Peninsula, where explo-
ly is under way.
10 Shebelinka, orth Stavropol', Gazli, Karadag, Ugersk, and
Ber I
ezan.
Gas Reserves/ Production Ratios
for Selected Regions'
Soviet natural gas is of generally good quality,
with a high methane content. [15] Handling gas
in some areas in the future, however, will not
prove to be easy. Much of the gas in Central
Asia, Orenburg, and the European USSR con-
tains significant amounts of hydrogen sulfide and
carbon dioxide, which must be removed. [16]
Condensate is a problem 11 both in these regions
and in West Siberia and in the Komi ASSR,
where hydrate 12 formation will complicate ex-
traction. Moreover, as exploitation enters lower
depths of such multistrata fields as Urengoy,
large condensate reserves could pose a greater
extraction problem than at the outset of produc-
tion. Formation pressure also will create difficul-
ties in some regions. Much of the gas in Turkmen
is under extremely high heat and pressure, re-
quiring special wellhead and collection equip-
ment able to withstand such conditions. On the
other hand, some Tyumen' fields-possessing
low pressure even before production-could ex-
perience serious pressure drops a few years after
extraction begins, [17] which would leave much
valuable condensate in the ground. Soviet gas
production through the 1980s will, accordingly,
require substantial improvement of gas extrac-
tion and processing capabilities (see appendix
D). Increased compressor power to maintain
adequate pressure in major Siberian pipelines,
because of falling gas pressure at the fields
themselves, will be required. Protection of trunk-
lines from corrosion and the expansion of use of
gas as feedstock in petrochemical industries will
" Condensate consists of gas liquids in the deposit that have been
separated from the dry gas by high heat and kept in liquid form by
high pressure. When extracted, condensate begins to vaporize under
the lower surface pressure. Cooler temperatures at the surface,
however, return part of the vaporized condensate to liquid form.
Processing plants at the field complete the recompression, after
which the condensate is separated into butane, propane, ethane, and
methane. Condensate must be removed from the gas before the
latter is transmitted through the pipeline. if it is not, the condensate
can vaporize in the line, damaging the pipe and causing other
transmission problems. At many fields in Siberia where processing
facilities do not yet exist to refine the condensate into usable
products, the condensate is wastefully discarded.
13 Hydrates result from the cooling of warm gas as it flows to the
surface. The condensation causes water vapors to collect at the top
of the well and down hole near perforations in the well casing. The
hydrates tend to plug the flow apertures in both areas, and at low
surface temperatures may freeze, causing valves to stick or split.
Older regions .......
..................
41.9
17.4
14.0
Ukraine SSR ...!
...................
38.2
16.3
12.4
Krasnodar' Kra,.
........
70.3
19.9
21.8
Stavropol' Kray
...............
30.6
16.4
12.7
Newer regions
113.0
358.0
320.4
Turkmen SSR
.. ...................
57.0
245.4
68.5
Orenburg Oblas
..............
35.2
47.5
236.8
Tyumen' Oblast
x
z
746.2
Source: Brentz, Ekonomika gazodobyvayushchey promyshlen-
nosti, pp. 25, 39.
Although reser es were large, production was negligible.
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require effective removal of gas impurities and
byproducts.
D. Emerging Problems in Expanding Reserves
The Soviets face growing difficulties in adding
to their gas reserves. Major increments will prove
harder and more costly to obtain. Substantial
new discoveries are likely, but overall growth in
reserves will slow considerably, despite the
planned step-up in capital in exploration outlays.
The increasing depth and complexity of promis-
ing formations and their location in inhospitable,
distant regions will pose new obstacles to Soviet
exploration capabilities, including rapidly rising
exploration costs.
Prospecting 13 represents a growing, though
small, percentage of Soviet gas industry invest-
ment. It jumped 600 percent during 1971-75
alone. Exploration may account for almost two-
thirds of total drilling for gas, as shown in the
tabulation below. [ 18]
Percent
1961-65 ................................ 43
1966-70 ................................ 57
1971-75 ................................ 63
" Published ruble expenditure figures for this sector of the
industry apply to both prospecting (for example, seismic mapping)
and actual exploratory drilling.
Table 11
Distribution of Gas Reserves,' January 1971
The average depth for exploratory drilling
increased only 33 percent during 1962-75, but
the Soviets expect it to grow by another 30
percent in 1976-80, and recent drilling results
suggest that it may increase even more than
that. [ 19] Reserves currently being exploited in
West Siberia mainly are at depths of 1,000-2,000
meters, thereby contributing to a relatively low
national average (see tables 10 and 11). How-
ever, in some important producing areas-nota-
bly Turkmen, Komi ASSR, and the Ukraine-
most proved and probable reserves are located at
depths greater than 2,000 meters. Further West
Siberian exploration will similarly have to search
to greater depths.
Technology will pose considerable problems.
Soviet drilling practices, predominantly based on
the turbodrill, become much less efficient at
Average Gas Well Depth '
1961
......................................................................................
1,580
1965
......................................................................................
1,775
1970
......................................................................................
1,857
1975
......................................................................................
2,100
1980
......................................................................................
2,700
' Source: V. A. Smirnov, "Gazovaya promyshlennost'," Ekono-
mika organizatsiya promyshlennogo proizvodstva, no. 5 (1975), p.
58.
Less Than
1,000 Meters
1,000-1,999
Meters
2,000-3,000
Meters
More Than
3,000 Meters
USSR ....................................
9.7
67.4
14.4
8.5
RSFSR ..............................
9.2
79.8
9.9
1.1
Komi ASSR ................
2.8
1.7
90.9
4.6
Orenburg Oblast ........
1.5
98.5
0
0
Tyumen' Oblast ..........
9.6
89.9
0.5
0
Ukraine SSR
..................
5.1
13.8
53.8
27.2
Kazakh SSR
....................
20.0
42.5
37.5
0
Uzbek SSR
......................
33.0
34.1
32.1
.8
Turkmen SSR .................. 4.1
19.7
17.3
58.9
Tadzhik SSR .................... 0
31.8
57.4
10.8
Kirgiz SSR ...................... 11.5
60.9
27.6
0
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depths of more than 2,000 meters. '^ This fact,
compounded by limited use of quality seismic
surveying equipment, has restricted the success
of explorat ry drilling. 15 As a result of inad-
equate seismic surveying, only minimal expan-
sion of reserves has been achieved in older
producing regions, where potential gas-bearing
formations Ore very deep. [20] The technological
difficulty of locating new reserves has prompted
exploration ~,rews to spend the bulk of their time
on step-out drilling 16 in known producing zones
rather than risking failure in promising but
unexplored reas. [21 ] After rising sharply in the
late 1960s, reserve additions per meter drilled
dropped steadily in the early 1970s (see figure 4
and tables 2 and J-12). Because of the con-
tinuance of these difficulties and because most
major gas deposits in Central Asia and northern
Tyumen' Oblast may have been discovered, an-
nual discoveries probably will level off or decline
during 1976-80, although they will remain far
higher than before 1965.
E. New Re, lions
Significant expansion of gas reserves beyond
the mid-1980s will rely in great part on explora-
tion in East Siberia, in the Soviet Far East, and
offshore. M scow may be planning a major
exploration 1rive in East Siberia and Yakutsk
ASSR during the remainder of the decade. [22]
Although the Soviets estimate large reserves in
the eastern regions-13 trillion cu m in Yakutia
alone-exploration in West Siberia, the Urals-
Volga, and !other regions has received higher
priority during the past 15 years. Only 0.5
meters have ;been drilled per square kilometer in
East Siberia) compared with 20 meters in the
"The turbodri 1, which constitutes almost 80 percent of all
Soviet drilling rig for oil and gas, employs drilling fluid under high
pressure to driv the drill bit. The rotary drill, which is the
predominant drill ng rig type used in the West, employs a drill bit
attached to high- uality drill pipe. The mechanized turning of the
pipe by the drillin rig-plus the weight of the pipe-drives the bit.
Turbodrill down- ole components generally wear out faster than
those for rotary rills.
" Most Soviet seismic recording is still done on analog tape
employing techno ogy used in the United States in the 1950s. This
leads to poor rec rding of important geological data.
16 Step-out drill- Fig is the sinking of wells to further define the size
and increase the r do of reserves to production of a known oil or gas
deposit.
USSR:
Addition to Natural Gas Reserves*
Per Meter of Exploratory Drilling
Million
Cubic Meters
* Corresponds very roughly to the Western reserve
categories of proved, probable, and possible.
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Exploration for Natural Gas in Selected
Gas Production Associations,' 1971-75
Production
Exploratory
Reserves Added
Association
Drilling
A + B + C,
(Thousand Meters)
(Billion Cubic Meters)
Tyumengazprom ....................................
T
k
120.0
8,655.1
ur
mengazprom ....................................
U
b
k
298.9
704.8
z
e
gazprom ..........................................
45.2
5
4
Kubangazprom
.
(Krasnodar' Kray) .............................
S
499.6
16.5
tavropolgazprom ....................................
107.0
3.0
Sources: Geologiya nefti i gaza, no. 6 (1976), pp. 16-18; A. D. Belorusov, et at., Problems razvitiya i razmeshcheniya proizvodstvennikh
sil zapadnoy sibierii, Moscow (1976), p. 19; Geologiya bureniye, no. 4 (1977), P, 3
Urals-Volga region. Drilling coverage for Ya- seismic surveying is not widely adopted. The
kutsk is similarly light. Proved and probable risk-avoiding emphasis on step-out rather than
reserves in East Siberia and Yakutsk are low as a exploration drilling will also hamper effec-
result, but Moscow may eventually expand the tiveness.
area covered and intensify drilling efforts in
promising locations.
Even if East Siberia and the Far East have
extensive reserves, many of their potential gas-
bearing structures are much deeper than gas-
bearing structures in West Siberia. More than 60
percent of Yakutia's discovered reserves are lo-
cated at or below 3,000 meters. [23] Moreover,
many formations will prove complex for survey-
ing. These problems will be aggravated by the
great distances from supply bases and current
transport lines and by difficulties with perma-
frost possibly exceeding those in northern
Tyumen'. Completion by the early 1980s of the
Baikal-Amur Railway parallel to but north of
the Trans-Siberian line will help, but huge capi-
tal investments in additional infrastructure will
still be needed."
Exploration, therefore, will probably move
slowly during 1976-80, and reserve additions will
increase only gradually, particularly if harsh
climatic conditions bring continued drilling prob-
lems in both East Siberia and Yakutsk and if
" In Irkutsk, the focusing of most exploratory drilling near the
Trans-Siberian railway in the past-while logistically practical-in
fact reduced aggregate results since the most promising exploration
sites known at that time were f *I- L
ur
Offshore formations may hold several trillion
cubic meters of gas, but they have received even
less attention than the East Siberian and Far
Eastern economic regions. '8 Structures in the
Kara and Barents Seas-adjacent to northern
Tyumen'-are estimated to have the largest un-
dersea Soviet reserves, but no major prospecting
has been done. Offshore Sakhalin reserves, once
estimated to be quite large, have been appraised
downward as a joint US-Japanese-Soviet explo-
ration effort continues. Proved reserves in the
Caspian Sea and off the Crimea are not large but
represent the best explored of Soviet offshore
formations, and drilling there could be substan-
tially increased.
Soviet offshore capabilities lag substantially
behind the West. With many undersea structures
located well below 3,000 meters (and under at
least 100 meters of water), poor technology has
clearly held up progress. The Soviets -do not have
the sophisticated offshore rigs, drilling and sub-
sea well completion equipment, and offshore
pipeline technology required for large-scale ex-
ploration and exploitation of offshore gas depos-
its, particularly those under arctic waters. Until
er nort , away from all-weather " For a general discussion of Soviet offshore as
transport routes. Review of Sino-Soviet Oil (June 1975), p. 15. Offshore Magazine (April 1976), g potential, see
pp. 63-67.
Reserves Added
per Meter Drilled
(Thousand Cubic Meters)
72,126
2,358
119
33
28
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Western-type
more widely t
zones probabl
and untappec
Ill. Product
Soviet gas
cu m, exceedi
tion thus act
growth duri
percent aver,
by 1980-th
year plan. (
increase to 3
billion cu m
equipment is purchased and used
iy the Soviets, most USSR offshore
y will remain relatively unexplored
on
production in 1977 was 346 billion
,rig 1975 by 57 billion cu m. Produc-
ieved a 9.4-percent average annual
rig 1976-77, well above the 8.5-
Lge needed to reach 435 billion cu m
e upper limit of the 1976-80 five-
ras output currently is planned to
70 billion cu m in 1978 and to 401
in 1979.[24]
USSR:
Selected Regional
Natural Gas Production
Percent
of Total
A. Growth 'in the East; Decline in the West
1. Recent Trends. The discoveries in West 30
Siberia and entral Asia of the USSR's largest
gas reserves Lave been reflected in the steady rise
in productio in these newer regions and in the
equally stea y decline of production from the
USSR's older fields. [25] The output of Stavro-
pol' and K asnodar' Krays and the Ukraine
constituted 1 percent of Soviet gas production
in 1965, but fell to 30 percent by 1975 (see tables
J-13, J-14, and J-15). North Caucasus produc-
tion droppe 43 percent during 1971-75. Ukrai-
nian output increased only 13 percent in the
same period and began to decline in 1977.
By 1972 combined Central Asian and West
Siberian pr duction had surpassed that of the
Ukraine (s a figure 5). The former two regions
provided only 14 percent (18 billion cu m) of
Soviet gas supplies in 1965, but their combined
output gre at an average annual rate of 21
percent du ing 1966-76, a sevenfold increase.
Central Asa contributed most of the increase,
rowing fr m 17.9 billion cu m to 104 billion cu
g
m-an ave age annual rate of 17.4 percent. West
Siberian output increased from 0.6 billion cu m
in 1966 to 8 billion in 1977-an average annual
rate of mo e than 50 percent. Central Asia in
1977 provided almost one-third of Soviet gas
production and West Siberia supplied 20 percent.
2. Future Growth. Most of the production
growth in 978-80-and virtually all output in-
creases thr ugh 1990-will come from areas east
of the Ura s (see figure 6). Moscow expects the
1960 65
576398 7.78
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USSR:
Regional Production of Natural Gas
Billion
Cubic Meters
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Ukraine's production to fall by approximately 12
percent during 1978-80, [26] but it will probably
decline more rapidly. The drop in European
USSR gas production during 1971-77 was offset
primarily b' Central Asian production. During
the next decade, however, West Siberia's north-
ern Tyumen' Oblast will have to make up for the
Ukraine's sharp decline and provide most of the
increase in total Soviet gas output. West Siberia
is scheduled to become the leading producer by
1980, contributing one-third of Soviet output
(see appendix C).[27] Central Asian production
will grow more slowly, and its share of national
production F is targeted to fall to roughly 26
percent.
As previously, the industry's growth through
the 1980s will in fact depend on the continued
developnleot of only a few large fields. During
1971-77, more than 95 percent of the additions
to national production came from six fields:
Medvezh'ye (Tyumen' Oblast); Vuktyl (Komi
ASSR); Qrenburg (Orenburg Oblast); and
Shatlyk, Achak, and Naip (Turkmen SSR).
During 1978-80 Turkmen [28] and Orenburg
[29] will ', add some capacity, but the main
growth will :come from Vyngapur and Urengoy
in Tyumen'. Urengoy, the USSR's largest
known gas; deposit, is expected by Moscow to
produce 58 billion to 60 billion cu in within
three yeai?s after coming on-stream in 1978.
Beyond 1980, Urengoy and other Tyumen'
fields-Zapolyarny, Yamburg, Yubilenoy,
Kharsavey, and Bovanenko-will constitute the
main sources of additional production.
Soviet gas output will also increase through
greater use of associated gas from oil wells. Lack
of equipment for handling such gas has forced a
high rate 'of wasteful flaring for decades (see
appendix D). The processing of associated gas
has grown slowly, rising from 8 billion cu in in
1960 to 29 billion cu in in 1975 (see table J-2), or
10 percent of total gas output. Increased invest-
ment in processing facilities, however, should
raise output substantially by 1980.
B. Increased Costs
Although costs of gas extraction are lower
than those for oil or coal production, they are
rising faster than production costs of any of the
other Soviet energy industries. The drop in out-
put from older fields and the difficulty of devel-
oping Siberian and Central Asian deposits have
pushed costs up substantially. The cost in con-
stant 1970 prices of extracting 1,000 cu in and
Change in Production Costs in Constant Prices'
Percent'
1970 Over
1975 Over
1965
1970
Oil extraction
-3.0
12.6
Gas production
8.5
45.9
Coal production
5.6
6.8
Electric power
0.1
2.4
' Expressed in "prices of the previous year." The official link
relatives given in the annual statistical abstracts (for example,
Narodnoye khozyaystvo 1974, p. 209) apparently are expressed in
the form of a "link cost" index of the following form:
F-P, Q2 ccEP2 Q3
C2 F-P, Q, ' Cs L~P2 Q2 . . .
2 The percent changes are based on absolute cost figures for the
four industries. Those figures were derived by (a) extrapolating a
benchmark cost figure for each industry by the official Soviet cost
index for that industry to obtain a series of production costs
(sebestotmost') in constant prices and (b) adding to the derived
sebestoimost' series (expressed in rubles/kopecks per unit of output)
an interest charge on each industry's reproducible fixed assets.
Benchmark cost figures for each industry were for 1970 or 1972.
They were derived indirectly from official coefficients for amortiza-
tion charges. For example, the 1970 cost (sebestoimost') for oil was
derived by (a) taking the 1970 amortization charge on fixed capital
in the oil industry (Narodnoye khozyaystvo 1970, p. 1971); (b)
dividing the total charge (in million rubles) by total 1970 oil
production to derive an amortization charge per metric ton of oil
produced; then (c) dividing that charge by its percentage of oil
production's sebestoimost' for 1970 (p. 174), to produce an approxi-
mate sebestotmost' (in rubles) for 1 ton of oil. This benchmark
figure was then extrapolated by use of the official cost index.
Capital stock in constant prices for 1965 and 1970-75 was derivd by
extrapolating 1972 capital stock figures for each industry (Narkhoz
1974, p. 62) through the official index for growth in capital stock
(for example, Narkohz 1974, p. 196). The resulting series represents
reproducible fixed assets in constant 1 July 1967 wholesale prices.
The capital charge for the industries was added by taking the 12-
percent interest of the derived stock figure for each year, dividing it
by the total physical units produced that year, and adding the result
to the base sebestoimost'.
Because the only charge for capital in official Soviet cost figures is
an amortization (depreciation) allowance, a synthetic interest charge
is incorporated. These cost figures embody-in the 12-percent
interest charge-the "convention" used by Western scholars to
derive an appropriate measure of capital's contribution.
' Does not include pipeline transport or storage.
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Figure 7
USSR:
Output-Capital Ratio for Gas Extraction
1,000 Cubic Meters/
1,000 Rubles
300
processing it for transport declined steadily from
1955 to 1965, but then rose sharply from a low of
2.71 rubles in 1965 to 4.29 rubles in 1975.[30]
Most of this increase occurred in the first half of
the 1970s when unit costs rose by 46 percent.
Costs for oil extraction, coal production, and
electric power generation grew much more
slowly (see table 13).
Total new fixed investment in gas extraction
rose from 1.0 billion rubles in 1966-70 to 3.1
billion rubles in 1971-75.[31] At the same time,
according to Soviet data, the ratio of output to
capital stock dropped from 294 cu m per ruble in
1965 to 96 cu m per ruble in 1975 (see figure 7
and table J-16).[32]
Large investments in older gasfields will
remain a drag on the industry's economic perfor-
mance. The need to satisfy growing domestic
consumption and export requirements will
prompt continued efforts to slow the production
decline from deposits in the European USSR.
Losses in capacity at older fields have increased
substantially. As a result, new investment in
1971-75 designed to compensate for output
losses-by drilling new wells in aging fields or by
developing new deposits both in older regions and
in West Siberia and Central Asia-exceeded
investment intended for major additions to na-
tional capacity.[33] During that period output/
capital stock ratios for the older fields declined
sharply (see tables J-16 and J-17).
A leading reason for the decline is higher
drilling costs. Squeezed by rapidly increasing
depths and steadily falling output, production
wells in older producing areas have grown in-
creasingly expensive to put into operation. The
average depth of overall development drilling
rose during 1971-75 from 1,745 to 2,100 meters.
New gas deposits in many of the long-exploited
areas-including most of Central Asia-are lo-
cated even deeper. Wells sunk in those regions
through 1980 will probably average between
3,000 and 4,000 meters, [34] depths that forced
well costs in those regions to climb more rapidly
than the national average of 14 percent during
1966-72 (see table 14). [35] Costs will continue
to rise sharply if Soviet deep-drilling technology
does not improve substantially, and they will be
covered to a decreasing extent by growth in
output per well. As more wells have been drilled
in regions of declining capacity, production per
well has nose-dived (see table J-18). [36] 19 Use
of certain types of drilling rigs in prospective
zones for which those rigs are not effective has
also contributed to higher costs. [37]
" The average output per well for the USSR as a whole has not
fallen steeply since peaking in 1965. A relatively high well average
for West Siberia has partially offset a decline per well for the
Ukraine and North Caucasus.
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Cost' of Development Wells
Cost
Cost
Cost
Cost
Average Annual
of Wells
per Well
of Wells
per Well
Increase (1966-72)
(Thousand
Number
(Thousand
(Thousand
Number
(Thousand
in Cost per Well
Rubles)
of Wells
Rubles)
Rubles)
of Wells
Rubles)
(Percent)
239,792
3,314
72.4
941,161
5,058
186.0
14.4
Ukraine ............................ 75,901
755
100.5
281,295
1,291
217.9
11.7
Uzbek .............................. 28,724
345
83.3
86
198
462
186
6
12
2
Krasnodar'' Kray
'
............ 37,740
468 80.6
,
122,760
735
.
167.0
.
11.0
Stavropol
Kay
'
.............. 15,000
389 38.6
68,520
787
87.0
12.3
Tyumen
Oblast
.............. NA
NA NA
NA
NA
450.02
NA
"Balance'?sheet" costs ("balansovaya stoimost"'), expressed in current factor prices. Unlike costs in the data underlying table 13, interest
charges on c pital are not included. Sources: G. Z. Khaskin, et al., Osnovnyye fondy gazovoy promyshlennosti, Moscow (1975), p. 41;
Ekonomika g azovoy promyshlennosti, no. 2 (1975), p. 12.
2 Represents lower end of a range of 450,000 to 600,000 rubles given for Tyumen' gas well drilling (1,000 to 1,200 meters) in 1975.
The state of applied Soviet well drilling and
completion technology has also contributed to
greater well expense. Drill bits, drilling fluids,
drill pipe, and casing are generally of poor
quality by Western standards, and have caused
up to 50 percent of total emergency downtime in
recent years. [38] Improvement is essential for
drilling deep wells in Central Asia, the Ukraine,
and particularly in northern Tyumen'- where
large high-capacity wells (144 to 166 mm in
diameter aid later possibly up to 273 mm) are
being drilled in an arctic environment [39] in
which the ground's freezing and thawing and the
widespread presence of hydrates can place
metals and other materials under tremendous
stress. [40] Serious blowouts or well cave-ins
could occur as a result. Wellhead equipment
often cannot handle high-pressure, high-tem-
perature gas, and serious production losses have
resulted over the years at many major fields.
Packer technology needed for extracting gas
from two or more strata through one well is still
primitive aT most fields and as a result gas losses
are large. [i41 ] 20 Soviet interest in dual comple-
20 A packer i a rubber annulus, attached to a length of pipe,
which can be in erted into a well and expanded to seal off the upper
part of the well from the lower. It can be used to permit the
extraction of oil; or gas from two or more productive strata through
separate tubingi in the same well (multiple completion). In the case
of multiple completion of several gas-bearing strata, packers serve
to maintain the, integrity of the production zones, each of which
may be under different pressure or contain gas of different quality.
tion methods nonetheless is substantial, and it
was attempted on more than 100 wells during
1971-75, [42] primarily at two of Turkmen's
larger fields-Achak and Naip. [43] Gas losses
at the latter two fields, resulting from faulty
packers and wellhead units, contributed to pre-
mature pressure losses which will reduce the
fields' productive lives.
The main cause of higher gas production costs
in the future will be West Siberian conditions.
During 1971-75 the nationwide cost of 1 meter of
production drilling rose from 140 to 210 rubles.
Of that increase, 56 percent resulted from mov-
ing equipment to new regions, while greater well
depths accounted for only 10 percent.[44] With
most proved north Tyumen' gas reserves at
shallower depths than in older regions, West
Siberia's major costs stem from harsh climatic
conditions. The desert production environment in
Central Asia has also hampered gasfield develop-
ment, but not to the same extent. West Siberia
lacks basic infrastructure required for direct and
indirect production support. Roads and railroads
are few and, along with other infrastructure,
their construction can constitute up to 60 percent
of investment in field development. [45] Drilling
and production equipment are frequently deliv-
ered either slowly by surface or by air, both at
Separation of the gas from different zones, in this manner,
facilitates processing of the gas at the surface.
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very high costs. West Siberia's permafrost and
tundra place tremendous stress on equipment,
labor, and living facilities, reducing productivity
and necessitating additional large outlays for
infrastructure.
Handling extracted gas in these areas will be
another economic burden. Moscow must expand
substantially its investment in facilities through-
out the USSR for processing of sour gas, gas
condensate, and associated gas. 21 Tyumen' Ob-
last's large reserves of condensate and associated
gas will require huge investments in plant capac-
ity. Investment in other equipment for collecting
and preparing gas for pipeline transport-such as
intrafield pipe networks-will grow substantially
as new fields come on stream. The length of
pipeline networks for intrafield collection in-
creased by 30 percent during 1970-73 (see table
J- 19).
The Soviets are prepared to expand the stock
of plant and equipment needed to improve their
gas production base. They are unlikely, however,
to attain targeted returns. The extraction end of
the industry has often underfulfilled plans since
1960, in great part because of lags in both
technological innovation and field equipment in-
stallation. Even where infrastructure has been
sufficient, poor management and chronic short-
ages have repeatedly created supply bottlenecks.
The industry will face the same or greater prob-
lems in the new producing regions in East Sibe-
ria, the Far East, and offshore. Moreover, unless
pipeline construction in remote northern areas is
hastened, the gap between planned production of
gas and actual deliveries to consumers will re-
main-regardless of the pace of field develop-
ment.
IV. The Gas Distribution System
The costliest and most trouble-plagued sector
of the Soviet gas industry is pipeline transport.
Moscow has made great efforts to install a
massive network of trunklines 22 and gas storage
21 Further details on gas processing and refining are given in
appendix D.
22 This paper will discuss only cross-country transmission pipe-
lines, not distribution lines within urban and industrial areas, which
by 1978 exceeded 108,000 km (Ekonomika gazovoy promyshlen-
nosti, no. 2 (1978), p. 3).
sites, linking its remote fields with domestic and
foreign consumers. Yet, the transport effort has
suffered from simultaneous lags in new pipeline
construction and chronic underutilization of ex-
isting trunkline capacity. As with gas extraction,
transport's problems show no signs of easing
before the early 1980s.
A. Current Status
The Soviets have already built the second
largest gas supply network in the world (see
map). Its length is roughly one-fourth of the US
system (see table 15), but its construction is
nonetheless a major achievement. Since the mid-
1950s gas pipeline installation has moved at a
fairly rapid pace to exceed 110,000 km of pipe by
1978. The network's length grew by 16 percent
per year in 1956-76, but the growth rate was only
8 percent a year during 1971-75, in part because
construction increasingly had to contend with
arctic and desert conditions (see table J-20).
Despite such obstacles, several large gas delivery
systems have been built from Tyumen' and the
Karakum Desert since the late 1960s (see appen-
dix I).
Average length of transport has grown substan-
tially especially since the late 1960s, reflecting
Length of Gas Transmission Pipelines in the USSR
and the United States'
USSR
United States
USSR as a Percent
of United States
1950
.............
2.3
182.1
1
1955
.............
4.9
234.9
2
1960
..............
21.0
295.8
7
1965
..............
42.0
340.3
12
1970
..............
67.5
406.8
17
1975
..............
99.2
434.91
23
1976
..............
103.5
416.511
25
'Sources: Narodnoye khozyaystvo SSSR, Moscow, various issues;
Basic Petroleum Data Book. Section XII, Table 2, American
Petroleum Institute (April 1977); Gas Facts, American Gas Institute
(1977.), p. 53.
2 Estimate.
The decline in length of US trunklines is generally due to
retiring of some lines where declining gas production has made their
further use uneconomical.
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the emerging production roles of Central Asia and
West Siberia. [46] The distance of new gasfields
from consuming centers now requires lines up to
twice the length of major trunk systems built 10
years ago, and Moscow expects the average
distance of transport to increase from 1,294 km in
1975 to 1,900 km by 1980.[47] Centralizing
control of such long-distance pipeline operations
has received high priority. In 1976, 6,300 km of
trunkline were automated (6 percent of the
trunkline network),j48] and several thousand
more kilometers were automated in the early
1970s including telemechanization of compressor
station and 'valve operations.
The increasing costs of transport, due to a
doubling of average length of transmission be-
tween the early 1960s and 1975, have been
partially offset by a greatly expanded use of
more economical, large-diameter lines, 23 (see
tables 16 and J-21). Large-diameter trunklines
accounted for 40 percent of total gas pipeline
length in 1975, compared with only 18 percent in
1965. As aresult the average pipeline diameter
has increased 83 percent during 1961-75 from
553 mm to 1,012 mm,[49] which is roughly
twice as large as that of the United States.
Pipeline transport is the gas industry's most
expensive sector. It embraces three-fourths of the
industry's fixed capital, receives about 60 percent
of the industry's annual investment and employs
20 percent of its 200,000-man labor force. [50]
Although its share of investment has dropped
13 Pipe of 1,020; mm or larger. The USSR has become the first
country to adopt the widespread use of 1,420-mm pipe, the world's
largest diameter.
Distribution of Gas Pipeline Sizes
Diameter
(Millimeters)
1960
1965
1970
1975
19801
1,420
..............
0
0
0
3.6
11.1
1,220
.............'
0
0
5.6
15.2
13.5
1,020
..............
3.2
17.8
23.5
20.8
19.3
820._ ..........
10.8
9.5
7.4
7.1
5.3
720 ..............
29.4
24.7
19.1
15.2
10.6
Other ............
56.6
48.0
44.3
38.1
40.2
slightly since the late 1960s-the result pri-
marily of a jump in allocations to extraction-
transport will continue to consume the bulk of
gas industry resources. New and larger logistical
problems of pipelaying and heavy imports of
large-diameter pipe and related equipment have
required continual and large increases in invest-
ment. Fixed capital in trunkl:ine transport more
than doubled in absolute terms during 1971-75
while gas production increased by 46 per-
cent.[51] New investment allocations per 1,000-
cu m increment of transported gas similarly
increased from 36 to 70 rubles in that
period. [52]
As a result of these trends average costs for
piping gas declined steadily through 1966, and
rose sharply in 1971-75.[53][54] 24 Inefficient
use of pipeline capacity due to lagging comple-
tion of new compressor stations (see section B,
below) and production declines at older fields are
also pushing costs up, as the latter has in the
United States. The prospect of continued under-
use of capacity is probably a major reason for
little Soviet discussion in recent years of building
lines of even larger diameter-such as 1,520
mm. The difficulty of manufacturing pipe and
equipment for such lines domestically, and the
expense of ordering them from the West, is
certainly another reason.
Still, Soviet claims of a unified natural gas
delivery system capable of maintaining adequate
year-round supplies to all major consuming cen-
ters are not yet justified. Repeated reports of gas
shortages-some of them "serious"-reflect the
pipeline-storage network's insufficient capacity
and flexibility to handle large demand fluctu-
ations. Substantial increases in storage capacity
during the current five-year plan (1976-80) are
slated to improve supply reliability for many
cities.
As the distance from gasfield to Soviet con-
suming centers has increased, underground stor-
age facilities for use during winter's peak
demand periods have become much more impor-
tant. And, indeed, gas storage capacity has
grown rapidly over the past few years. Storage
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sites grew from only four in 1960 to 25 in 1975,
raising total storage capacity from 0.7 billion cu
m to 39.5 billion. Ten facilities were built during
1971-75 alone (see appendix E).[55] Almost all
of them are near the largest cities in the Euro-
pean USSR. The primary improvements in dis-
tribution, however, must still come in the pipeline
network itself, where expansion efforts thus far
have run into several serious problems.
B. Pipeline Construction Problems
The Soviet gas industry has consistently failed
to meet production goals, primarily because
trunklines to newly opened fields either were not
completed on schedule or were operating at
below capacity. Such failures stem from several
basic problems:
(1) The increasing length of pipelines and the
need to construct them under adverse climatic
conditions.
Conditions surrounding trunkline construction
are unlikely to improve. Along with greater
length will come an increase in the number and
severity of natural obstacles. West Siberia's bur-
geoning pipeline network is being installed in
regions of tundra, permafrost, and swamps,
where adverse weather and ground conditions
limit pipelaying to only a few months of the year.
The large Central Asia-Center system covers
thousands of kilometers of desert. The Orenburg
pipeline will cross more natural and manmade
obstacles than have most Soviet lines in the past.
Lack of roads, housing, and established supply
and repair bases-particularly in Tyumen'-
Use of Gas Trunkline Capacity'
Percent
Use of
Capacity Use Capacity
(2) Inadequate capacity to produce and install
1967
1968
..........
.... ? .
150.7
182.8
143.3
155.1
95
85
rapidly large diameter pipe and powerful
1969
..........
185.8
166.0
89
compressors.
1970
..........
235.7
181.5
77
1
244
8
209
86
1971
..........
.
.
(3) Shortages of skilled manpower, machin-
1972
..........
244.1
219.9
90
ery, and materials for pipeline projects and poor
1973
..........
261.1 ?
231.1
89
management of available resources.
The pace of trunkline construction has held
close to plan during the 1970s. Over 30,000 km
of pipe were laid during 1971-75, meeting the
five-year plan.[56] Compressor station comple-
tions in that period increased by 156, against 85
new stations built during 1966-70.[57] Although
total compressor station power increased sharply
in 1973-75 (see table J-23), 25 use of aggregate
trunkline capacity has rarely risen above 90
percent of the maximum potential (see table
17). 26 On several major lines in 1975, use was
only 66 percent of capacity (see table 18).
ZS By 1977, more than 70 percent of on-line compressor capacity
was generated by gas turbine drive-as opposed to piston drive-
and electric power sources. Turbine units are more efficient and
have larger capacities than other forms of gas line compressors.
Robert Campbell, Recent Trends in the Soviet Oil and Gas
Industry,. Baltimore (1976), pp. 56-57.
a This performance is similar, however, to that in the United
States.
Source: Khaskin, Osnovnyye fondy, p. 47.
Table 18
Use of Capacity of Selected Gas Trunklines, 1975
Maximum
Percent Use
Trunkline
Capacity
Use
of Capacity
Total ..............................
237.8
158.0
66
Medvezh'ye-Nadym ..
60.0
31.0
52
Nadym-Punga ...........
56.0
40.0
71
Punga-Northern
Lights ......................
42.0
30.0
71
Urals system
20.0
15.5
78
Nadym-Punga-
Gor'kiy-Center ......
17.3
14.5
84
Central Asia-Center
Nos. 3 & 4
42.5
27.0
64
' These lines were cited by the Soviets as examples of underutili-
zation due to lagging installation of compressor capacity. Source: R.
D. Margulov, et al., Razvltiye gazovoy promyshlennosti i analiz
techniko-ekonomicheskikh pokazateley, Moscow (1976), p. 46.
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slow construction considerably. Efficiency of So-
viet logistical organization, perennially low in
good conditions, deteriorates further in remote
areas and.
:can delay some projects for months.
Several trunklines, including the Northern
Lights and Messoyakha-Noril'sk systems, have
suffered breaks from stress caused by cold and
the buckling of the ground from repeated freez-
ing and tl awing.[58] Installing some. pipe sec-
tions aboveground on berms and trestles has
reduced the problem but has not eliminated it.
High winds, for example, have continued to
shake the lines, chafing insulation and in some
cases toppling pipe from the supports, causing it
to break. Poor-quality pipe insulation has led to
breaks in swampy and desert regions as well as in
permafrost.
Inadequate technology and capacity in support
industries have particularly hindered the delivery
system's development. A major problem for the
rest of the decade is a shortage of domestically
manufactured large-diameter pipes and valves of
high metallurgical quality needed to withstand
Siberian cold and internal corrosion. Pipe and
valve imports have solved part of the problem,
but Moscow wants a larger domestic production
capability,[59] particularly to reduce hard cur-
rency outlays on imports of large-diameter pipe.
The Soviets must, in addition, improve gas
processing capacity in both Central Asia and
northern Tyumen' to reduce the amount of corro-
sive gas entering trunklines. This problem has
particularly plagued Central Asia's large pipe-
line systems. [60] Welding technology on most
lines under construction also lags behind the
developed West, causing both delay in pipelaying
and pipeline breaks during operation. Soviet
inability to produce compressor station compo-
nents in adequate. number and quality is another
major weak spot. Moscow has made substantial
imports of compressor equipment, but the total
supply of units for large-diameter lines is still
short.
Faced with these natural and technical obsta-
cles, the Soviets have tried to accomplish more
than their ;limited resources allow. Trunkline
capacity has:frequently fallen short of plan, in
great part because manpower, machinery, and
materials have been spread thinly among many
projects. Both oil and gas lines compete for the
same labor force, and only a few projects receive
adequate allocations. Emphasis on putting north-
ern Tyumen' gasfields onstream clearly has given
priority to expanding the region's major pipeline
systems-Northern Lights., Urengoy-Chelya-
binsk-Center, Urengoy-Nizhnaya Tura-Center.
Even so, Moscow has not had enough skilled
manpower or advanced equipment in recent
years to finish on time all the routes and com-
pressor stations that it has planned for those
areas.
V. Trade
Rapid growth in natural gas production is
paralleled by the increasing importance of gas to
Soviet foreign commerce. Soviet net exports of
gas will rise from 7 billion cu m in 1975 to
approximately 40 billion cu nn in 1980, and hard
currency earnings in 1977 prices will jump from
$200 million to well over $1 billion. But Soviet
imports of gas will also increase beyond 1980,
limiting growth in 1981-85 of net gas exports.
Natural gas has only recently become an
important Soviet export. During the early 1960s,
USSR gas trade-while composed entirely of
exports-was inconsequential[ (see figure 8 and
table J-24). [61] The export volume did increase
in the latter half of the 1960s, and in 1970 was
more than eight times the level of 1965. It was
still fairly small, although larger than the volume
of imports from Afghanistan, which began in
1967. With the addition of imports from Iran,
the Soviets became net importers in 1970-73. Z'
Not until 1974 did the USSR finally emerge
as a substantial international gas supplier. Total
exports to Eastern and Western Europe almost
tripled in 1974-75, giving the Soviets net exports
of 2.1 billion cumin 1974 and 6.9 billion cumin
1975. Deliveries to Western Europe were made
mostly through gas-for-pipe compensatory ar-
rangements. The export volume in 1976 was 25.8
billion cu m, 66 times larger than that of 1965,
2' Imports were made via a pipeline built from Iran to the Soviet
border. See section B, below.
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Figure 8
USSR: Natural Gas Trade
Billion
Cubic Meters
and the value of exports also climbed from 2.7
million rubles in 1965 to 733.4 million rubles in
1976. 28 Of those receipts, hard currency earnings
from Western Europe constituted an increasing
share beginning in 1974-75, jumping from nearly
$30 million in 1973 to $346 million in 1976.
Despite the USSR's brief stint as a net importer
28 At the respective official ruble-dollar exchange rates for those
years, the dollar values would be $3 million (1965) and $972
million (1976).
in physical terms, it never experienced a deficit
in net earnings. The ruble value of imports grew
from 14 million in 1970 to 176 million in 1976.
A. Exports
Eastern Europe has received the bulk of Soviet
gas exports thus far and will continue to do
so. [62] Until 1968, European members of
CEMA 29 were the sole recipients of the USSR's
exports and during 1960-75 took 67 percent of
the gas shipped beyond the Soviet border. That
percentage is likely to drop to about 55 percent
during the last half of the 1970s, and will
probably hold to at least that level through 1985.
Substantial exports to Eastern Europe began
in the early 1970s.[63] The USSR had exported
small amounts of gas to Poland since the late
1950s, but it was only after completion of the
first Bratsvo (Brotherhood) trunkline to Czecho-
slovakia in 1967 and full development of Ukrai-
nian gas production that exports to Eastern
Europe began to expand substantially (see table
J-25). In 1973-75, Bulgaria, East Germany, and
Hungary became importers, and exports to
Czechoslovakia and Poland increased as the
Bratsvo line's capacity was raised and its length
extended to other East and West European coun-
tries and as new lines were built. The substantial
growth in exports to both East and West began
at that point.
By the early 1980s, Soviet gas supplies to
Eastern Europe will have doubled over current
levels (see table J-26). Additional East European
demand will be met partly by further expansion
of the Bratsvo trunkline, which will handle gas
from the Ukraine, Central Asia, and West Sibe-
ria. Most of the increase, however, will come
from the Orenburg pipeline, scheduled for com-
pletion in late 1978 (see appendix F). Stretching
2,750 km from the newly developed Orenburg
field to the Czechoslovak border, the line is to
deliver 15.5 billion cu m to the five current
CEMA customers plus Romania. Although the
line, being partly constructed and financed by
"The Council for Mutual Economic Assistance. Its European
members are Bulgaria, Czechoslovakia, East Germany, Hungary,
Poland, and Romania.
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the six importers, probably will not reach full
capacity until well after 1980, it still should
permit a doubling of total Soviet exports to those
countries by 1981. Yugoslavia will also begin
receiving up to 3 billion cu m of Soviet gas in the
early 1980s via Czechoslovak and Austrian
lines. [64]
As a result, the Soviet-supplied share of total
East European imports will rise from 96 percent in
1975 to almost 100 percent by 1980, when it could
be satisfying almost 40 percent of all East Eu-
ropean gas: requirements. Bulgaria and Czechoslo-
vakia are (see table 19 and table J-27), and will
continue to be, almost totally dependent on the
USSR for gas supplies.
Western Europe is a newer but far more
important market for Soviet gas. Increases in
both demand and price in Western Europe will
make gas a substantial hard currency earner in
the late 1970s. By 1980 Soviet annual gas earn-
ings could exceed one-half of the hard currency
earnings anticipated from the export of crude oil
and oil products in that year. The increase in
hard currency receipts during 1974-76 reflected
both a doubling of prices (from $15 per 1,000 cu
m in 1973 to $30 per 1,000 cu m in 1976) and a
quintupling of the volume of gas exports to West
European customers (see table 20).
Austria, benefiting from a branching of the
Bratsvo line; became the first Western importer
in 1968. As : growth of Soviet gas production in
the late 1960s raised both Soviet export capacity
and the need for gas-related equipment and pipe
Million
Metric Tons
Million
b/d
Hard Currency
Earnings
(Million US $)
93
1.9
405
123
2.5
3,180
148
3.0
4,500
1970 ...............
1975
1976 ...............
Source: Vne8hnyaya torgovlya SSSR (1970, 1975, and 1976).
z Including oil products.
One billion cubic meters of gas equals 16,800 b/d oil.
Natural Gas Exports to Eastern Europe
as a Share of East European Gas Consumption
Percent
1965
1970
1975
Total ...................................... 2
6
18
Bulgaria .............................. 0
0
100
Czechoslovakia ................. 0
64
83
East Germany .................... 0
0
29
Hungary ............................ 0
0
10
Poland ................................ 23
17
31
Romania .............................. 0
0
0
imports from the West, Moscow began a more
substantial penetration of the. West European gas
market. During 1969-76 the Soviets concluded
several trade agreements, most of them involving
exchanges of gas for large-diameter pipe and
ancillary equipment on credit. The majority of
these agreements provide for continued deliveries
of Soviet gas beyond 1990.[65] During 1973-74
West Germany, Italy, and Finland began receiv-
ing gas deliveries; France became an importer in
1976.
Under contracts signed before 1977, Soviet
exports to Western Europe will triple in the last
half of the 1970s, reaching 25 billion cu m by
1980. That amount will represent an estimated
19 percent of all gas supplies of those West
European nations receiving Soviet gas. In caloric
terms, Soviet gas exports to Western Europe in
1980 will equal more than 50 percent of probable
Soviet oil imported by that region. Exports
Billion
Million b/d
Hard Currency
Earnings
Cubic Meters
Oil Equivalent
(Million US $)
- 0.3
Negl.
13
6.9
0.1
223
14.0
0.2
346
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through 1985 will increase by at least another 40
percent under an arrangement concluded with
West Germany, Austria, France, and Iran in
early 1976 (see appendix G). 30 Up to 23 percent
of total gas supplies of countries importing Soviet
gas would be furnished by those Soviet exports.
Further deliveries during 1981-85 under addi-
tional contracts are possible, although the
amounts are difficult to determine. If USSR gas
supplies cannot meet demand in both Eastern
and Western Europe, for example, the Soviets
probably will give priority to East European
customers to forestall political and economic
disruptions among the East European partners.
Expansion of exports to Western Europe much
beyond current contract levels then will be less
likely. Joint ventures in liquid natural gas
(LNG) exports with Western Europe, Japan, and
the United States would also expand Soviet
export revenues. However, LNG deliveries will
not begin until the late 1980s or early 1990s at
the earliest, even if contracts are consummated
within the next year, which is unlikely (see
appendix H).
B. Imports
Soviet gas imports will remain fairly stable
through 1980, with Afghanistan and Iran re-
maining the USSR's sole suppliers. Imports rose
sharply in 1970-72 from initial deliveries through
the 1,200-km Iranian-Soviet trunkline, stretch-
ing from the Ahwaz gasfield to the Soviet border
town of Astara in the Transcaucasus. Imports
from that line-currently about 10 billion cu in a
year-so far have been made on a barter basis.
During the current Five-Year Plan (1976-80)
they should increase by only 18 percent.
Afghanistan, which became the first gas ex-
porter to the Soviet Union in 1967, pipes almost
all of its production to Central Asia for local
Soviet consumption. The Soviets have assisted
Afghanistan in expanding its production and
transport capacities and will continue to do so
J0 By 1980 Soviet gas exports' share of total gas supplies of all
Western Europe could reach 9 percent and by 1985, 11 percent. On
the other hand, Soviet gas deliveries will constitute only 2 percent
of total Western European energy supplies in 1980 and 3 percent in
1985.
during 1978-80. [66] Consequently, Afghan ex-
ports to the USSR will probably increase moder-
ately in the early 1980s.
Iran has provided the bulk of Soviet gas
imports since 1971 and will do so for the next
decade. Almost 10 billion cu in of Iranian gas is
delivered annually through the 1,200-km trunk-
line entering the USSR at Astara in the southern
Caucasus, [67] and this level may rise slightly
during the next four years. Soviet imports from
Iran will double by 1985, however, under a
trilateral switch deal. The Soviet Union will
import an added 17 billion cu in annually from
Iran for use in gas-poor Soviet regions and will
pipe a slightly smaller amount of Soviet gas to
the three West European consortium members
and to Czechoslovakia. [68] The increase will
negate much of the expected volume gain in
USSR exports during that period, but the reex-
port .to Western Europe may provide consider-
able net hard currency earnings for Moscow (see
appendix G).
VI. The Need for Western Assistance
Gas production-like output . in most other
sectors of the Soviet economy-is to grow during
the Tenth Five-Year Plan primarily through
increased productivity of labor and capital.
[69] 3' How much productivity does increase,
however, will depend greatly on technological
improvements. Repeated calls for a "technical
reequipping" [70] of the industry reflect serious
Soviet weaknesses in several areas, many of
which have been or could be partly alleviated by
purchases of Western equipment and technical
assistance.
A. Pipelines
The USSR cannot produce all the high-qual-
ity, large-diameter pipe and valves needed for
expansion of the pipeline systems linking
Tyumen' with the Western USSR. [71] Poor-
quality equipment for welding and weld-testing
is a related shortcoming. [72]
"The Gas Ministry expects labor productivity increases in gas
extraction (33 percent), gas processing (47 to 48 percent), and
pipeline transport (9 percent). See Gazovaya promyshlennost', no.
11 (1976), p. 4.
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Consequently an increasing share of Soviet
imports involves pipeline-related items. Much of
the large-diameter, high-quality steel pipe used
in gas lines constructed since the late 1960s has
come from Western Europe-Austria, West
Germany, Italy, and France in gas-for-pipe
deals-and; from Japan. During 1971-75 the
USSR spent more than $4 billion on 6 million
tons of large-diameter pipe, [73] at least 5
million tons of which probably went for gas
lines. 32 I 'ports of gas-related equipment
reached roghly $1 billion in 1975-about 7
percent oftotal Soviet hard currency imports.
[74] Pipe again constituted most of the bill.
Imports of large-diameter gas pipe, mostly 1,420
mm, may reach 8 million to 10 million tons in
1976-80, the current five-year plan period.
[75]
B. Compressor Stations
The Soviets through the early 1980s will not
be. able to: manufacture enough turbines and
high-capacity compressor units (for example, 25
megawatts) [76] to provide required pressure in
the West Siberian pipeline system. Lack of unit
standardization [77] permitting rapid repair or
replacement is a major problem.
Gas turbine and compressor purchases have
risen in recent years, with more than $1 billion
spent during 1972-76 for 3,000 MW of capacity
[78]-the equivalent of almost 40 percent of
total Soviet compressor capacity in 1975. 33 Mos-
cow may order up to 10,000 MW of additional
compressor power by 1980, most of which would
be placed on the northern Tyumen' pipeline
systems. [79] In 1976 the Soviets signed two
contracts calling for delivery in 1977-78 of
equipment' having a total capacity of almost
2,000 MW:
? A 158-unit deal for 22 compressor stations
on the Orenburg pipeline-to be built by
AEG Kanis (Mannesmann) of West Ger-
many and Italy's Nuovo Pignone (ENI) for
approximately $1 billion. [80]
32 Soviet trade figures for large-diameter pipe imports include
pipe of sizes ranging from 530 mm to 1,420 mm.
33 Most of the units purchased during 1972-76 were not installed
by the latter date.
? An agreement providing 42 units for six
compressor stations on the Urengoy-Chelya-
binsk line-delivery by a US-UK consor-
tium for $166 million. [811
C. Gas Processing
Many gasfields lack sufficient capacity to
collect gas of high temperature or under extreme
pressure; to process associated gas or gas with
sulfur, condensate, or other properties; or to
provide initial compression for transport of high-
volume output. [82] To boost Soviet gas process-
ing capability Moscow has ordered at least three
processing plants for West Siberia. [83]
D. Well Drilling and Completion
The Soviets will remain interested in purchas-
ing Western drilling equipment such as rigs, drill
pipe, and well casing material, plus wellhead
assemblies and equipment for completing wells
that exploit several gas-bearing strata simul-
taneously.
E. Exploration
Effective seismic equipment and digital field
computers are not widely available to Soviet
exploration teams.[84] Soviet technology in this
area is well behind that in the West and usually
is not adequate for accurate mapping at 5,000-
6,000 meters in Turkmen, the Ukraine, and
Komi ASSR or in the permafrost of Siberia and
the Far East. The Soviets in the past few years
have shown increased interest in obtaining West-
ern seismic mapping equipment.
F. Offshore
Soviet experience in all phases of offshore
petroleum production has been limited mainly to
the shallow portions of the Caspian and Black
Seas, where expansive networks of piers, trestles,
and manmade islands have been used instead of
floating drilling platforms.[85] Floating plat-
forms, subsea completion equipment, and related
technology needed for exploration and develop-
ment operations in deeper waters of the Kara Sea
and elsewhere pose requirements that exceed
current Soviet production capability. Even West-
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ern firms have not yet manufactured offshore
rigs capable of working in the hazardous waters
off northern Siberia. A few Western-designed
offshore drilling rigs have been purchased for use
in the Caspian Sea, but major imports of off-
shore technology needed for operations in arctic
waters probably will not occur for several years.
VII. Prospects
The outlook for Soviet gas production is rela-
tively bright compared with that for oil output,
which is expected to peak in the early 1980s.
Proved-plus-probable reserves of 28 trillion cu in
would provide 80 years of output at the 1977 rate
of 346 billion cu m. In contrast, US reserves of
6.2 trillion cu in would supply only 11 years of
output at the 1976 US rate of 565 billion cu in.
Moreover, Soviet reserves are likely to expand by
several trillion cu in over the next decade. Al-
though there remains substantial uncertainty,
annual growth in gas production can reasonably
be expected to average about 6 percent during
the Tenth, Eleventh, and Twelfth Five-Year
Plans which cover the 1976-90 period (see table
21). That the gas industry may fail to meet a
particular annual or five-year plan goal-as is
likely in 1976-80-is not of central importance to
longer term Soviet energy planning. Of greater
importance is the fairly steady rate of growth
that can be expected over at least the next 10
years.
Natural gas will not, however, solve Soviet
energy problems. Gas export earnings by the
mid-1980s may make gas the Soviets' leading
hard-currency export, but technical problems
Projected ' Gas Production
will prevent gas from soon being substituted
widely for oil in the domestic economy. More
important, if difficulties facing the gas industry
are not overcome within the next few years, not
even West Siberia's large gas reserves will be
able to guarantee continuous production growth
beyond 1985. Two basic problems will affect
development of the gas industry during the
Tenth Five-Year Plan and beyond: (a) rapidly
falling production at older fields and (b) persis-
tent bottlenecks hindering expansion of Siberian
output.
A. The Tenth Five-Year Plan (1976-80)
Gas production during 1976-80 is planned to
rise by 50 percent-or at an average annual rate
of 8.5 percent-reaching 435 billion cu m in
1980. To do so, the gas industry will have to
improve its performance in several areas (see
table 22). Of primary importance is the addition
Planned Growth of the Gas Industry
During the Tenth Five-Year Plan
1976-80
1975 1980 Plan
Billion Cubic Meters
Production .................................... 289 435
Gas storage 3 .................................. 18 45
Natural gas processing ................ 22 32
Associated gas processing ............ 29 40-45
Exports .......................................... 19 593
Imports .......................................... 12 15,
Apparent consumption ................ 282 391,
1975
............
Billion Cubic Meters
289
Average
Annual Percent Growth
1980
............
415-420
7.5-7.8
1985
............
560-600
5.9-7.71
1990
............
700-730
3.1-5.4 2
' CIA projections.
' Five-year period.
' Sources: Gazovaya promyshlennost', no. 3 (1976), pp. 1-3; no. 11
(1976), p. 12; and no. 8 (1977), pp. 2-6; Ekonomicheskaya gazeta,
no. 6 (1977), p. 2.
Volume of recoverable gas in storage.
3 Estimated.
Including pipeline transmission systems; total investment for
1971-75 and 1976-80.
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of 35,400 km of the trunk pipeline system-
much of it to be 1,420-mm pipe.34 Successful
completion of a massive compressor station con-
struction program will prove equally important,
since below-plan installation of compressor ca-
pacity would prevent the trunkline system from
handling the high level of gas output planned for
1980. Pipelines and compressors accordingly will
consume nh, ost of the record 19 billion rubles of
investment- allocated to the the industry in the
Tenth Five-Year Plan.
None of these goals is easily achievable, how-
ever, and nationwide gas production probably
will not reach the upper limit of the 1980 plan-
435 billion cu m-primarily because installation
of pipeline compressor stations will continue to
lag. Supply of large-diameter linepipe probably
will not pose a major problem, with substantial
imports of pipe already contracted for making up
most or all shortfalls in domestic manufacture.
The principal bottleneck will be inadequate ca-
pacity on the three lines scheduled to move gas
from northern Tyumen' to the European USSR.
Under apparently intensive development, Uren-
goy, Medvezh'ye, and smaller neighboring fields
probably will reach their planned aggregate ca-
pacity of 1.39 billion cu m by 1980. 35 Construc-
tion of the first Urengoy-Chelyabinsk line will
have been completed before that time, but full
completion of additional lines on the Northern
Lights and Urengoy-Center systems-the other
two lines to serve Tyumen'-is less likely. More-
over, Soviet delays in negotiating imports of
Western compressors, long leadtimes for the
manufacture and delivery of imported units, and
lagging Soviet installation of the units will allow
perhaps only 120 billion to 125 billion cu m to be
moved-15 billion to 20 billion cu m below plan.
The Soviets themselves have indicated concern
"This can be compared with 31,700 km of pipeline laid in 1971-
75 and equals the total length of gas trunkline laid in the United
States between 1968 and 1976. Pipe of 1,420-mm diameter is the
largest pipe in substantial use in the world. At proper pressures it
allows large volumes of gas to be transported at costs lower than
those for transport of similar volumes in smaller pipes.
95 The remainder of the 155 billion cu m planned for Tyumen'
Oblast in 1980 will come primarily from associated gas production
at the region's major oilfields. That output will move southward via
the Nizhnevatovsk-Kuzbass line, essentially completed in late
1977, which should reach full capacity by 1979. Gazovaya prom-
yshlennost', no. 3 (1977), p. 6.
with these problems by having long retained the
range of 400 billion to 435 billion cu m in the
1980 plan. One Soviet publication in early 1977
cited the plan as 435 billion cu m [86] but the
Gas Ministry reintroduced the range later in the
year. [87]
Moreover, as indicated above, Moscow has
planned for a certain loss in output from the
older fields of the European USSR and Central
Asia during the last half of the 1970s, while
investing heavily since 1970 to minimize the
amount of that loss. A precise projection of the
reduction in output is difficult. An aggregate
Ukrainian gas production plan for the current
Five-Year Plan of 1976-80, however, indirectly
indicated that output there could drop from 69
billion cu m in 1976 to roughly 50 billion cu m by
1980 rather than the 59 billion cu m planned
earlier (see appendix A).
How fast gas output increases will depend
heavily on the priority it receives. If a decline in
oil production and continued sluggish growth in
coal extraction prompts greater Soviet demand
for gas for domestic use and export, Moscow may
expand 1981-85 investment well beyond the 19
billion rubles planned for 1.976-80. Most new
investment will probably go to northern Tyumen'.
Given resources sufficiently greater than the
estimated 15 billion rubles allocated to Tyumen'
field and pipeline development in the last half of
the 1970s, [88] several major deposits-notably
Yamburg, Zapolyarny, and possibly Kharsavei on
the Yamal Peninsula-could be developed simul-
taneously. Equally important, major new pipe-
lines could be constructed to link the fields with
existing Northern Lights and Urengoy-Center
systems. Such an effort, combined with Urengoy's
attainment of a possible peak capacity of 100
billion cu m in the early 1980s, [89] could result
in 1985 production levels at the upper range of the
560 billion to 600 billion cu m projected in this
paper.
Output much beyond that. range, however, is
unlikely. Infrastructure shortcomings and per-
mafrost conditions will prove worse at the new
fields than at Urengoy and Medvezh'ye. These
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two factors will plague field development and
pipelaying and may limit additions to production
capacity regardless of the amount of resources
expended. Only if intensive development of the
remaining large deposits begins before 1980-
which is unlikely-would any crash effort bring
more than one of the fields and its pipelines up to
full capacity by 1985. More likely, Yamburg and
Zapolyarny will both begin production by that
year at partial capacity. Kharsavei and other
fields probably will not contribute to output until
the late 1980s.
Production growth throughout the 1980s prob-
ably will be constrained by West Siberian bottle-
necks and by declining extraction at aging fields
elsewhere in the USSR. Currently at least 100 of
the USSR's 300 producing gasfields have passed
peak production, [90] and this proportion will
rise substantially in the 1980s. Intensive extrac-
tion efforts may slow the rate of decline in
production through 1980. By the early 1980s,
however, the Ukraine, all of Central Asia, and
some Tyumen' fields will experience major drops
in output, forcing new Siberian fields to cover
growing losses of capacity before contributing to
net increases in national production. Yet con-
straints on Tyumen' gas production will limit
that region's ability to fulfill both those tasks. As
a result, Soviet gas output may rise to only
around 700 billion cu m in the late 1980s. A
virtual leveling off of production at that point is
possible, although a decline is unlikely.
C. Continuation of Rising Costs
Development of the Tyumen' gas industry will
substantially raise the cost of Soviet natural gas
extraction and transport during the 1980s. A
massive investment campaign to develop several
giant Tyumen' deposits will increase the pace of
production but will lower the ratio of output to
capital even further. Continued heavy investment
in infrastructure will contribute to rising gas
production costs. A major acceleration in pipe-
line and compressor station construction would
lead to even higher costs per unit and result in
low returns. During the 1980s the Soviets' ability
to solve pipeline-related problems, particularly
compressor manufacture and installation, could
improve considerably. Increased purchases of
Western equipment and assistance (see the next
paragraph) or improved and expanded produc-
tion of Soviet compressor models would facilitate
enlargement of pipeline capacity. How far the
Soviets will move in this direction in the 1980s,
however, remains unclear. Outside Tyumen',
continued heavy investment to maintain output
in fields with declining extraction rates similarly
will raise industry costs. The Ukraine will prove
a particular drain through the early 1980s, as
may Uzbek and Turkmen.
Western assistance possibly could bolster the
effectiveness of gas industry investment. US,
European, and Japanese aid in pipeline installa-
tion, drilling, and gas processing-as well as
exports of related materials and equipment-
might permit more rapid and efficient utilization
of investment in a stepped-up Tyumen' develop-
ment drive.
D. Reliance on the West
The Soviet gas industry indeed will remain
dependent on imports of Western equipment into
the 1980s. If the remaining large gas deposits at
Tyumen' are developed roughly one at a time,
gas-related import requirements may not greatly
exceed those for the Tenth Five-Year Plan
(1976-80). If the pace is substantially increased,
the Soviets will probably expand equipment
imports. In this case direct Western technical
assistance in field development and pipeline con-
struction would be helpful, but past Soviet reluc-
tance to allow on-site Western participation
makes this unlikely. If Moscow launches a major
effort to find and develop reserves in the arctic
seas north of West Siberia, Western equipment
will almost certainly be required. Most addi-
tional imports of pipe will probably be made
through gas-for-pipe compensation agreements
with West European firms. Gas deliveries over
several years will be required to pay for the pipe
and other equipment obtained, but increases in
the price of exported gas could reduce the
timespan.
Soviet ability to purchase all the needed West-
ern gas-related imports and assistance, however,
may well be constrained, particularly if, as is
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likely, oil export earnings fall sharply in the early
1980s. Moreover, even Western help may prove
unable to solve substantially or rapidly the mas-
sive problems facing large-scale development of a
wilderness region until the infrastructure-par-
ticularly transportation-is vastly improved. A
stronger Soviet ability to assimilate advanced
technology-whether Western or domestic-is
also essential for significant improvement in re-
turns on capital.
E. Stepped-Up Campaign
Moscow's concern over the pace of Tyumen'
gas development does appear to have grown
during the past year. Correspondingly, the So-
viets have shown signs of stepping up their
campaign to open the region's giant gas de-
posits. 36 Since mid-1977, Soviet press articles
criticizing slow or sloppy handling of pipeline
and field construction projects have increased in
number and frankness. Major stories in Pravda,
Izvestiya, and other major papers have aired
complaints regarding those problems as well as
the basic lack of infrastructure needed for indus-
try support.;[91 ]
The December 1977 plenum of the Central
Committee of the Communist Party apparently
launched a drive to improve the situation. [92]
Budgetary allocations to the Gas Ministry re-
portedly have been increased-along with those
to the Oil Ministry-beyond the amount origin-
ally provided 'for in the 1976-80 plan.[93] Addi-
tional men and equipment have already been
transferred to Tyumen'. [94] In effect, Moscow
appears to be shifting resources from older gas-
producing areas to West Siberia, where it calcu-
lates that returns on investment will prove
higher.
It is unclear whether the new program repre-
sents an effort of sufficient magnitude to be
termed a crash campaign. Some objectives of the
current Five-Year Plan, such as the Urengoy-
Chelyabinsk pipeline, have been rescheduled for
rapid completion.[95] Yet the commitment to
the massive and sustained effort required to
36 The campaign also applies to the Tyumen' oil region. See
Sotsialisticheskaya industriya' (22 January 1978).
develop several giant fields and related pipeline
systems simultaneously in the early and mid-
1980s-instead of one at a time-is not yet
evident. Unless the new emphasis on Tyumen'
development results in the widespread resolution
of infrastructural, technical, and organizational
problems, the extra resources will probably not
produce much more gas over the next several
years than would be produced without them.
Indeed, if the Tyumen' campaign induces in-
creased competition for budgetary resources be-
tween the Oil and Gas Ministries, the latter's
Tymuen' program may be curtailed. Moreover,
transfer of resources from older gasfields, espe-
cially those in the Ukraine, will ultimately force
output there to drop even faster, undercutting
part of the additional increment in Tyumen'
output that the stepped-up campaign will induce.
F. Not a Panacea
Because of the likely outcome of developments
discussed above, natural gas will ease but not
solve expected Soviet energy problems in the
1980s. It will provide the Soviet energy balance
with a relatively fast-growing source of fuel and
raw materials, in fact approaching or exceeding
crude oil production in caloric terms by 1985. 3'
Gas will only be able to substitute for oil in some
of its uses, however. Most opportunities for easy
substitution of gas for oil have already been
exploited. Some additional gas production will go
for use in industrial boilers and to industrial
sectors which are already large gas consumers
and in which gas is being substituted for fuels
other than oil. Gas consumption will continue to
increase substantially in the chemical and metal-
lurgical industries, where it has been replacing
coal and coke. Household use will also increase,
but will not involve gas-for-oil substitution, since
oil has not generally been used directly for
heating purposes.
Although substantial conversion could occur in
electric power generation, where oil-burning
thermal power plants can switch more readily to
" Oil production in 1985 probably will bd between 8 million and
10 million barrels per day. Output of natural gas probably will fall
within the range of 560 billion to 600 billion cu m, equivalent to
about 9.4 million to 10.1 million b/d of oil. See Prospects for Soviet
Oil Production, op. cit.
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gas than to coal, no such shift is apparently
intended for the plan period ending in 1980.
Indeed, planners actually intend to reduce the
share of gas in total fuel consumed by thermal
power plants during this period. [96] 38
Additional industrial sectors can also switch to
greater gas consumption in the 1980s. Given
declining oil output and an official intent to
minimize reliance on foreign energy sources,
Moscow undoubtedly will attempt to use gas
more widely.
The Soviets currently show no signs of initiat-
ing the large-scale substitution campaign that
would be required. The nature of significant
substitution within individual industrial sectors is
not clear, and further research is needed to
determine the amount of oil-for-gas substitution
possible for each industry within a period of five
or 10 years. If historically long Soviet leadtimes
characterize such an effort, a widespread shift to
gas could be delayed until the late 1980s. Also
unknown is the resource allocational priorities
that the Soviets would be willing to assign to a
major substitution effort and the extent of the
technical difficulties they would face.
Internationally, hard currency earnings from
natural gas exports to Western Europe will grow
7e Several oil-burning plants in the European USSR could make
the switch in the 1980s if a domestic oil shortage required it.
However, gas storage capacity near these plants would have to
undergo substantial expansion to avoid winter gas supply shortages
due to the seasonal peak in demand.
substantially. Western Europe is increasing gas
consumption and diversifying its import sources,
assuring an expanding market. [97] Demand for
Soviet gas could be moderated through the early
1980s by new European gas sources-primarily
North Sea supplies-and by trade agreements
with Algeria and other gas-producing countries.
Supply of Soviet gas for export could be con-
strained occasionally by lagging development of
Soviet field and pipeline capacities and possibly
by additional gas export commitments to Eastern
Europe.
Nevertheless, gas export earnings ultimately
should equal the hard currency receipts attained
by export of oil. Earnings of $1 billion (in 1977
prices) by export of gas in 1980 will surpass
neither the $4.5 billion obtained in 1976 from
exports of oil nor the potential earnings of $2.7
billion from oil exports in 1980. By 1985, how-
ever, gas will have emerged as a leading foreign
exchange winner, with gross hard currency re-
ceipts of $2 billion (in 1977 prices) likely. The
Soviets meanwhile could be making hard cur-
rency outlays for net imports of oil unless, as is
unlikely, a successful gas-for-oil substitution
campaign at home frees oil for continued export.
The importance of gas to future Soviet trade is,
therefore, substantial. At the very least gas will
provide a large portion of the USSR's purchasing
power to cover the rising costs of Western tech-
nology and equipment that its gas industry's
expansion in the 1980s will require.
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How much the older gas-producing regions in
the North Caucasus, the Ukraine, and the Urals-
Volga region '9 support future growth of Soviet
gas output will depend on how rapidly their
contribution declines. After 20 years of extensive
exploitation these areas are suffering from prob-
lems typical of aging gasfields:
? Steadily diminishing reserves.
? An absolute drop in production.
? Rising production costs.
The reserves situation in the Ukraine and the
Caucasus, already poor in the early 1970s, will
grow much worse. With the principal deposits
developed, exploration teams are faced with the
need to locate potentially much smaller ones at
great depths (4,000-6,000 meters) in complex
geological structures. [98] The results so far in
the 1970s have not been good (see tables 8 and
12). Exploratory drilling in the most promising
areas-such as the Ukraine's Dnepr-Donetsk
and Carpathian basins and the Chernolesskiy
region in the Northern Caucasus-has borne
little fruit.[99] Inaccurate seismic mapping of
deep structures has led to drilling a large number
of dry holes. [ 100] Exploratory drilling itself has
lagged because of the lengthy downtimes of
drilling rigs. Gas exploration rigs in the Ukraine
were idle more than 70 percent of the time as a
result of technical problems in drilling and a lack
of supplies. [ 101 ] The few fields that have been
opened since the late 1960s for the most part do
not have more than 10 billion cu in of reserves (A
+ B + Q. However, offshore exploration in the
"Because Urals-Volga and Azerbaijan gasfields-the other
"older fields"-have been of minor importance to gas production,
the appendix discussion will deal only with fields in the Ukraine
and the North Caucasus.
Caspian and Azov Seas may increase reserves
slightly in the 1980s.
With expensive exploration efforts showing
little return, gas production associations will
attempt to maintain current output levels at
existing fields. By drilling new production wells
to deeper gas-bearing strata and increasing ex-
traction from currently exploited zones, the So-
viets probably hope to stabilize output at least
through 1980. Thus, even if reserves by that time
are near exhaustion, the old fields may avoid a
drastic shortfall that would hold national produc-
tion below the 1980 goal. The Soviets are par-
ticularly counting on minimizing the Ukraine's
decline.
Although the republic's output did not peak
until 1975, it grew at only 2.4 percent a year
during 1971-75. Following the region's success in
averting a production decline forecast by Mos-
cow for 1976, the Ukraine's projected 1980
production was raised to 59 billion cu m [102]
from 53 billion cu m.[103] At the higher level, it
would fall 14 percent below 1975-not low
enough to detract substantially from West Sibe-
ria's growth.
A sharp drop in Ukrainian production might
be averted for the next year or two. By the early
1980s, however, the older regions as a whole will
have experienced a substantial decline (see
figure A-1). Gas from the Caucasus, even with
some offshore production, will constitute less
than 5 percent of national production by 1980.
The Soviets will continue intensive development
drilling at existing fields, which already possess
60 percent of USSR production wells, [104] but
the returns will prove small. Production in Kras-
nodar' and Stavropol' Krays will continue to
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USSR:
Production of Older
Gas-Producing Regions
Billion
Cubic Meters
J-17).[107] Ukrainian extraction, still one of the
most important factors in Soviet gas supply, will
begin to diminish substantially in 1978-80.
If Soviet plans for 1980 in the Ukraine are to
be met-which is unlikely-major investment
will be required. In fact, up to 350 new pro-
duction wells are planned for the 1976-80
period. [ 108] With extraction in the Shebelinka
field falling rapidly (see figure A-2), however,
the newer but smaller fields will not nearly cover
the republic's output losses. The Krestishchensk
field is now the leading Ukrainian field, but its
output probably will peak by 1980. Return on
investment, already declining (see table A-2),
will continue, and 1980 production in the
Ukraine could fall below 50 billion cu m. 40
Offshore production in the Black and Azov Seas
will aid Ukrainian output in the mid-1980s, but
will not stop an accelerated production decline.
Dwindling output from the older producing
regions in the next decade will clearly act as an
increasing drag on the gas industry's perfor-
mance. The Ukraine's role in supplying gas for
export will seriously diminish. It is probable that
the USSR will fail to reach the 1980 plan's upper
range of 435 billion cu m. Such failure will be
due in no small part to the lack of production
capacity in the old fields, which will continue to
tie up much of the industry's annual investment
and fixed capital at least through 1980, while
their share in national extraction will drop to
roughly 18 percentage points. Yet because the
old fields are now producing more than one-
fourth of total gas output, Moscow may not feel
that it can afford to reduce investment in them
sharply.
nosedive because additional reserves are not
there.[ 105] More than 30 percent of Krasnodar'
wells and 13 percent of Stavropol' wells were
inactive in 1975. [ 106] Outlays for capital and
labor have continued at high rates, however,
while returns have plummeted. Stavropol' ex-
traction costs in 1971-75 rose 250 percent; those
for Krasnodar', 600 percent (see tables A-1 and
' A 1976-80 aggregate production goal for the Ukraine of 265
billion cu m (Neftyanaya i gazovaya pro myshlennost' no. 1 (Janu-
ary-March 1977, p. 2) suggests an annual average output of 53
billion cu m for the period. Since Ukrainian production in 1976,
1977, and perhaps 1978 and 1979 is scheduled to be higher than
that, 1980 output apparently is planned to be considerably lower
than 53 billion.
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Gas Production in Krasnodar' Kray
C)
C
CD , o
(D
Output per Well Output/Capital Production Cost
Production' Total Producing (Million Cubic Ratio (Rubles/Thousand
(Billion Cubic Meters) Wells 2 Wells 2 Meters/Year) (Cubic Meters/Ruble) Cubic Meters)
1961 5.7 88 62 92 310 0.45
1964 16.4 206 178 92 370 0.38 83 335 0.46
1968 ... ... . . -. 23.3 319 282
1 24.5 367 357 69 265 0.54 1970 .......... 21.3 394 384 55 195 0.77 1972 110 1.35
13.3 389 365 36
1975 5.8 818 587 10 NA 5.47
..........
' Does not equal total production for kraY because the data represent output from 10 major fields only. Sources: Brentz, Ekonomika
gazodobyvayushchey promyshlennosti, pp. 49-51; Margulov, Razvitiye gazovoy promyshlennosti, p. 29; S. A. Orduzhev, Gazovaya
promyshlennosti po puti progressa, Moscow (1976), p. 30.
2 Estimate.
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Selected Ukrainian Gas Field Production '
Eastern Ukraine
Shebelinka
Production
(Billion Cubic Meters)
Total
Active
Output per Well
(Million Cubic Meters/Year)
Output/Capital Ratio
(Cubic Meters/Ruble)
Production Costs
(Rubles/Thousand Cubic Meters)
1957 ...............................
1960 ...............................
. 1.9
. 8
9
24
80
23
129
160
0.33
1965 .......
.
26
9
70
159
417
0
28
........................
1970 ...............................
.
.
. 31.0
238
393
227
133
455
.
0.26
1971 ......
31
388
82
294
0
36
.........................
1972 ...............................
.
.3
. 30
1
423
454
419
77
260
.
0.40
1973 .....
.
27
5
423
72
225
0.48
.......................
1974 ................................
.
.
25.0
482
511
474
502
62
183
0.54
1975 ......... ..................
22
7
535
51
157
0.64
1976 ....
.
19
5.
44 4
128
0
99
............................
.8
556
543
37
108
.
1.18
Krestishehensk
1970 ................................
1971 ................................
0.3
2.6
3
12
3
100
52
1.48
1972 ......
6
1
8
175
170
1
37
..........................
1973 ................................
.
9.5
20
30
18
475
250
.
0.29
1974 ...
14
26
430
236
0
28
............................
1975 ................................
.1
18
6
48
41
345
292
.
0.40
1976 ................................
.
21.4
63
84
61
83
305
300
260
0.42
Western Ukraine
233
0.56
1961 ................................ 5.0 90 75 67 400
1965 ................................ 7.1 94 88 0.26
81 380 0.25
1970- ................. ............. 6.0 147 144 42
1972 ............................... 235 0.35
. 4.4 133 125 34 175
0.45
'Sources: Brentz, Ekonomika gazodobyvayushchey promyshlennosti (1975), pp. 61-64; Geologlya, bureniye i raxrabotka 2azovukh mestorozhd siy no 17 (1977 n. a~~17
(1977 ). D. 15.
Data from four fields: Ugersko, Bilche-Volitza, Rudki, and Khodnovichi. Data for years other than those shown were not available.
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CENTRAL ASIA
Soviet Central Asia" is playing a short-run
but crucial role as the USSR's leading gas
producer. In that capacity the region has:
(1) Increased its gas output from 40 billion cu
m in 1969 to 105 billion cu m in 1976, thereby
contributing almost 50 percent of the annual
increase in total Soviet production during that
period.
(2) Supplied nearly one-third of the national
output in 1975-77.
(3) Surpassed Ukrainian production begin-
ning in 1973. In effect, Central Asia during the
late 1960s and early 1970s served as a swing
producer-making up for declining output in the
European USSR while West Siberia's reserves
were being developed-and became an important
gas supplier for both Soviet and European
consumers.
Central Asia's emergence as a gas producer
was dramatic, although it will soon be oversha-
dowed by West Siberia's performance. Central
Asia's output in 1976 was nearly 134 times that
of 1960. During 1961-76, output grew at an
average annual rate of 36 percent. Most impres-
sive was the region's ability to maintain a 14-
percent annual growth rate during 1971-75,
nearly doubling the already substantial produc-
tion level of 1970. Thus, within 15 years Central
Asia's contribution to Soviet gas supplies rose
from 2 percent to almost one-third.
The region's output maintained this pace by
developing in two stages. Following the opening
of the large Gazli field in 1961, Uzbek was
" As defined here, the southernmost region of the USSR east of
the Urals composed of the Socialist Republics of Turkmen, Uzbek,
Kirgiz, Tadzhik, and Kazakhstan.
responsible for the rapid rise in Central Asian
gas output (see table B-1), providing 78 percent
of the region's production increase during 1961-
69. As Uzbek's growth slowed in the 1970s,
Turkmen's output skyrocketed. [109] Production
rose at an annual rate of 35 percent during 1970-
76, jumping from 7.5 billion cu m to 63 billion cu
m. Turkmen's output accordingly climbed to 60
percent of Central Asian production and pro-
vided about 85 percent of regional growth in that
period.
Central Asia's gas consumption is relatively
low, and the bulk of its production, from roughly
600 wells, 12 is piped elsewhere. [ 110] Uzbek has
supplied the Urals and the Moscow region since
the mid-1960s via several large trunklines (see
appendix I and the map). Turkmen's production
boom has been handled by completion-although
tardily-of the Central Asia-Center pipeline sys-
tem, which can transport yearly up to 90 billion
cu m of Uzbek-Turkmen gas. Although much of
the Turkmen gas is going to European USSR
consumers, much is also going to European
importers via linkups with trunklines in the
Ukraine. Barring extremely sharp drops in
Ukrainian extraction, Central Asia should pro-
vide enough gas to maintain Soviet export capac-
ity until Orenburg and West Siberia's fields can
take over.
Nonetheless, Central Asia's role as the leading
gas supplier will end soon. Not only will West
Siberian production exceed the desert region's
output, Central Asia's growth will slow consider-
ably. The region's reserves-roughly 3 billion cu
m [111 ]-are much smaller than those of north-
ern Tyumen' Oblast, and Uzbek's output is
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 Soviet CentA$,A F aRJigs2 ore>s : ftpe60T00702A000100060007-7
I W_
Astrakhan;
5hevchanko
declining, leaving Turkmen alone to provide
further increases. Turkmen's current high
growth rate will also slow during 1978-80.
Production from the Uzbek SSR peaked in
1973 and has declined slowly since then. Extrac-
tion in 1976 was 3 percent below 1973 and
probably will fall at a similar or higher rate
through 190. New additions to reserves are
small (see table 12), and Uzbek's principal fields
have all pa4sed their prime. The largest field,
Gazli, still 'accounts for most of Uzbek's gas
extraction. Its production rose meteorically, in
the mid-19610s, providing, one-seventh of Soviet
output in 1966-68, and peaked in 1971 at 26.4
billion cu in (see table B-2). Production by 1976
was approximately 20 billion cu m-a drop of
about 25 percent. Gazli's production costs in
1976 were still fairly low compared with those of
fields in Turkmen and Tyumen', but its costs will
rise markedly as output continues to fall.
Uzbek's supply to major Soviet consuming cen-
ters will also shrink substantially as the republic
increasingly diverts its output to Central Asia's
own growing gas consumption.
Future growth of Central Asian gas produc-
tion will come from Turkmen, although all the
major fields that boosted the republic's output in
the early 1970s are at or near their peaks. The
Achak field is fully developed and Naip has
almost reached full production.. Most important,
the massive Shatlyk field's output, planned to
reach 35 billion cu m in 1977, [112] has appar-
ently peaked. No similar field is in sight. Most
Turkmen deposits-known and potential-are
? Gas deposit
Gas pipeline
CAC Central Asia-Center
System
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below 3,000 meters and will probably prove
much smaller than Shatlyk's. Thus, even if
Shatlyk sustains its peak output for a decade-
which is unlikely-Turkmen's ratio of reserves to
production will fall, hampering production
growth in the 1980s. The Turkmen gas produc-
tion association was scheduled to produce only 57
billion cu m in 1977, [113] against 55 billion cu
m in 1976. Declining extraction rates at sections
of the Achak and North Achak fields in fact
have already occurred. [114] Smaller fields like
Okarem, Tedzhen, Bayram Ali, Kirpichli, and
Sakar could add more than 20 billion cu m to
Turkmen output by the early 1980s. [ 115] They
may not reach peak capacity soon enough, how-
ever, to enable the republic to meet its plan of 75
billion to 80 billion cu m for 1980. These and
other small fields will expand production only
slightly before it peaks in the early 1980s, and
Central Asia will fall behind West Siberia as the
nation's leading source of natural gas.
Production
(Million Cubic Meters)
Percent of
USSR Output
Uzbek Output
as Percent of
Central Asia
Turkmen Output
as Percent of
Central Asia
1960
.......
781
1.7
57.2
30.0
1961
........
1,451
2.5
69.9
16.7
1962
........
2,488
3.4
81.7
10.2
1963
.......
3,410
3.8
87.7
7.5
1964
........
10,197
9.4
91.4
6.8
1965
........
17,867
14.0
92.2
6.5
1966
........
24,130
16.9
93.5
5.2
1967
........
29,448
18.7
90.5
7.6
1968
........
34,809
20.6
83.3
13.9
1969
.......
39,763
22.0
77.4
18.9
1970
........
48,048
24.3
66.8
27.3
1971
........
54,129
25.4
62.2
31.2
1972
........
59,469
26.9
56.7
35.8
1973
........
71,512
30.3
51.9
40.1
1974
........
82,527
31.7
44.9
47.6
1975
........
94,011
32.5
38.8
55.1
1976
........
104,530
32.6
34.4
59.9
' Source: Narodnoye khozyaystvo SSSR, various issues.
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Production
(Billion Cubic Meters)
Output per Well
(Million Cubic
Meters/Year)
Output/Capital
Ratio
(Cubic Meters/Ruble)
Cost of Extraction
(Ruble/Thousand
Cubic Meters)
1962
.......
0.7
175
455
0.67
1963
........
1.8
95
192
0.59
1964
........
8.4
180
505
0.28
1965
........
15.4
220
635
0.16
1966
........
21.4
205
700
0.15
1967
........
23.9
150
655
0.15
1968
........
24.9
140
640
0.15
1969
........
25.3
140
650
0.15
1970
........
26.1
140
670
0.16
1971
........
26.4
135
675
0.16
1972
........
23.0
115
575
0.16
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
APPENDIX C
WEST SIBERIA
West Siberia is the Soviet gas industry's great
frontier in terms of the region's distance from
major consuming centers, its production poten-
tial, and its expected costs. East Siberia and the
Soviet Far East may eventually attain similar
status, but only West Siberia has proved-plus-
probable reserves massive enough to make it the
focal point of the gas industry's planning through
the 1980s. Moscow expects the region during
1976-80 to:
(a) Increase its share of gas reserves (A + B
+ C,) to more than 70 percent of the
national total.
(b) Account for more than 80 percent of all
increases in Soviet gas output.
(c) Become one of the principal suppliers for
European gas consumers.
West Siberia's promise for the gas industry,
however, is matched by the problems it presents.
The Soviets have been allocating increasingly
large sums to projects related to the region's
development (see table C-1). During 1976-80,
Moscow may devote almost 80 percent of the 19
billion rubles in gas industry investment to West
Siberian-related projects. [116] However, the
region's gas production in the next few years
probably will not match publicized Soviet expec-
tations. Well into the next decade, West Siberian
gas output will suffer from a serious lack of
infrastructure, slow development of giant fields,
continuing problems with pipeline construction,
and unprecedented costs.
Production Potential
West Siberia shares with the Persian Gulf the
potential to become the world's leading gas-
producing region. [117] By early 1976 its ex-
plored reserves constituted roughly 20 percent of
estimated world supplies." Until the Persian
Gulf's potential is more fully explored, West
Siberia-mostly in northern Tyumen' Oblast-
will thus account for the largest gas reserves
located in any one area (see the map). [118]
Since 1960 the oblast's reserves have grown at an
average rate of 44 percent a year (see table C-2),
and by 1977 they accounted for 61 percent of
total Soviet reserves. More than 80 percent of the
reserves in Tyumen', moreover, are in a handful
of large fields (see table C-3). [119] Indeed the
Urengoy field, with reserves of more than 5
trillion cu m, may be the world's largest. [120]
Exploratory drilling in northern Tyumen' has
been very effective. Total exploratory drilling for
gas in the region has .not been as extensive as in
Turkmen, Orenburg, and some older producing
regions; nor has it equaled exploratory drilling
for oil in southern Tyumen' (0.6 meters drilled
per square kilometer for northern Tyumen' to
10.4 meters per square kilometer in southern
Tyumen'). [121] Additions to reserves per meter
drilled in northern Tyumen', however, were 20
million cu m in 1966-70 and 72 million cu m in
1971-75-both unprecedented results. [122]
Similarly, with Tyumen' gas production still
relatively low, the oblast's ratio of reserves to
production is far higher than the Soviet average.
These indicators will drop as new reserves be-
come harder to find and as production rises.
Nonetheless, the Soviets expect Tyumen' re-
serves to increase by several trillion cu m by
1980-an attainable goal that will provide most
of the increase in total USSR reserve capacity
during the balance of the 1970s. [123]
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
_ _ Vndk ?nna~.~
'4t _ Nizhnevartovsk
West Siberian Gas Fields
and Gas Pipelines
? Natural gas field
Pipeline in operation
- - Pipeline planned or
,under construction
Magnitogorsk
Orenburg
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Kh
Kharsavey` it r 7
~. o sxa I
.w J
Bovanenk0
r
N9r'rl'sk
1 Neiti sk
Solinensk
Semakov
Yernpuri
Novy essoyakhe
Port Ic
Pt;tgove
~ ; Me zh~ e /ZepolyImy
Urengoy e.~ ^ u r
i noy i _h = :a f Ku,k
1 r Yul"
 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Soviet planners expect gas production in
northern Tyumen' Oblast to skyrocket. Since the
Medvezh'ye gasfield began production in 1972,
the region's output has climbed substantially.
Gas extraction reached 68 billion cu in in 1977-
20 percent of the Soviet total. [124] With the
Urengoy field having come onstream in 1978, the
Soviets expect the gasfields of northern Tyumen'
Oblast to produce 139 billion cu in in 1980.
[125] The remainder of the 155-billion-cu m
plan target for Tyumen' as a whole will be filled
by increased production of associated gas at the
oblast's oilfields-notably Samotlor. The
planned increase in Tyumen' gas production
would provide more than 80 percent of the
increase in national output and would raise the
share of Tyumen' in that output to 35 percent.
However, regional production of only 120 billion
cu rn to 130 billion cu m seems a more likely
prospect. Medvezh'ye provided most of the
growth until it peaked at approximately 65 bil-
lion cu in in 1977. [126] Urengoy subsequently
will account for most of the increases in Soviet
output until the mid-1980s. By then other large
Tyumen' fields may have been developed, mak-
ing the region responsible for well over half of
Soviet gas production.
Pipeline construction will play a crucial role in
the Tyumen' gas industry's success or failure in
meeting the 1980 plan. To satisfy Moscow's
commitments to domestic consumption and for-
eign trade, the Soviets are installing some of the
world's largest gas trunkline systems. Three ma-
jor systems-Northern Lights, Urengoy-Center,
and Urengoy- Chelyabinsk (see appendix I)-
lead from the Urengoy, Vyngapur, and Medvez-
h'ye fields and are planned to exceed 150 billion
cu m in combined capacity by 1980. The North-
ern Lights and Urengoy-Center systems are
partly complete and are supplying gas to the
European USSR. By the early 1980s, the ex-
panded network could also handle much of
Soviet exports to Eastern and Western Europe.
Problems of Development
Realizing the gas potential of northern
Tyumen' will prove time-consuming and
costly. [ 127] The 1980 production goal probably
will not be met, even though total allocations to
the Tyumen' gas industry will almost certainly
exceed the approximately 15 billion rubles ap-
parently planned for 1976-80. The Soviets clear-
ly expect delivered costs of Tyumen' gas to soar
above those for other new fields, as development
time increases and investment follows suit, as
indicated by data in table C-4. The 1975 ratio of
output to capital for the Nadym Gas Production
Association (operating the Medvezh'ye field)
was below the USSR average (see table J-16).
The cost of drilling a gas well in Tyumen' ranges
from four to six times higher than in the Europe-
an USSR. [ 128]
Leading causes of slow and expensive develop-
ment of West Siberia's gas industry are dis-
cussed in the following two sections.
Lack of Infrastructure. An efficient network
of roads and railways in northern Tyumen' has
yet to be built. The Surgut-Urengoy, Nadym-
Urengoy, and Yamal railways are lagging in
construction and need to be supplemented by all-
weather roads. Installation of such roads would
require 1.2 million to 1.6 million rubles per
kilometer, [ 129] compared with 0.12 million
rubles in the European USSR. [ 130] Production
support facilities-such as intrafield roads, sup-
ply depots, repair facilities, and power supply-
remain inadequate. Entire towns-notably
Nadym and Urengoy-are being erected for the
labor force which, because of the rugged living
conditions, is paid wages more than twice those
for workers at older fields. [ 131 ]
Infrastructure development consequently con-
sumes a large portion of investment, as indicated
by the Medvezh'ye field's experience (see tables
C-5 and C-6).[132] Not only have infrastructure
expenditures constituted a relatively large por-
tion of Medvezh'ye's capital allocations (they
will easily exceed 1 billion rubles by 1980), [ 133]
but they have also been principally responsible
for raising the cost 4' of Medvezh'ye's stock of
fixed reproducible assets to eight times that for
the next largest Soviet field currently in produc-
tion. [134] The number of nonproduction support
personnel required to maintain infrastructural
., Does not include a capital charge.
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and social services has been larger and faster
growing than the ranks of production workers
themselves. [ 135]
Until huge sums are spent on improving the
Tyumen' road, river, and rail systems, airfield
facilities, and local production base, large expen-
ditures will go toward a makeshift form of
supply. [ 136] Most materials and equipment are
now brought part way by ship and rail. In winter,
supplies can be further transported overland by
truck or tractor. During much of the year,
however, the tundra, permafrost, and swamp
conditions inake ground transport difficult, and
air shipments are essential. The high cost of
either mode of transport is compounded by the
inability of Tyumen' to supply more than a small
portion of its own construction materials. 45
Heavy cargoes, therefore, must be moved over
long distances, often with many reloadings and
delays that, according to Soviet statements, ren-
der useless 20 percent of delivered materials
through accidents, rust, and other problems of
long exposure to weather. [137] Poor coordina-
tion among the 20 agencies involved in West
Siberian oil and gas production is a major factor
in this regard. As a result, aggregate freight costs
are enormous. An article in one Soviet journal
indicates that the recent average of 80 rubles per
ton is expected to rise at least five times by 1980.
[138] Air transport alone has already accounted
for 30 percent of Medvezh'ye's costs. [139]
Technology. West Siberia's inhospitable cli-
mate and terrain continue to test the gas indus-
try's technical capabilities. Pipeline construction
and maintenance in permafrost and swamp is the
greatest problem. [140] Pipeline stress and cor-
rosion would be alleviated by improved pipe
metals and by gas cooling facilities, but these
probably will not be widely available in the
region for several years. High-capacity, automat-
ed collection stations will also prove slow in
arriving, causing field development bottlenecks.
Drilling of large-diameter wells will permit un-
precedented flow rates (up to 1 million cu in per
45 Northern Tyumen' plants supply only 50 percent of reinforced
concrete, 15''percent of crushed rock, 25 percent of gravel, and 20
percent of woodworking products needed for gas industry installa-
tions. Gazovaya promyshlennost', no. 3 (1976), p. 14.
day) [1411 but may also increase problems of
well completion. Melting of permafrost around
wells producing high-pressure gas can cause se-
vere wellhead subsidence and casing collapse,
halting production. Natural thawing and refreez-
ing of permafrost produces similar results. Im-
proved casing materials and well refrigeration
are needed, [142] but will not be introduced
quickly. Improved ground transportation-such
as air-cushion vehicles for movement of men and
equipment over marshy tundra [143]-is another
urgent need that will not be widely filled until
after 1980, when large-scale manufacture of
vehicles currently being tested may become
possible.
Toward 1980 and Beyond
Inadequate pipeline capacity will be the most
likely constraint on northern Tyumen' gas output
during 1978-80. The Soviets apparently are in-
tensifying development of the Urengoy field to
enable it to produce an estimated 58 billion to 60
billion cu m by 1980. [144] If the required gas
collection lines and processing equipment are
installed within the next three years, Urengoy
should reach or come close to that target.
Development has also begun at the neighboring
small field of Vyngapur (scheduled to produce 5
billion cu m in 1978 and perhaps up to 18 billion
cu m in 1980 [145]), whose output by 1980 can
probably fill the rest of the 139-billion-cu m
goal not covered by Urengoy, Medvezh'ye (65
billion cu m), and older northern Tyumen' fields.
The relatively small fields of Gubkin, Yubilenoy,
and Komsomol'sk may also be undergoing initial
development.
However, the capacity of the region's pipeline
system-estimated at 70 billion cu in in early
1978-probably will not expand quickly enough
to reach the 139 billion cu m required by early
1980. The additions of new lines-several of
them 1,400-mm pipe-to the Northern Lights
and Urengoy-Center systems and laying of at
least the first line of the Urengoy-Chelyabinsk
system may be completed by the late 1970s.
Installation of compressor capacity, on the other
hand, probably will lag considerably. More than
60 compressor stations-each with several corn-
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pressor units-will be required on the three
systems, [146] with many units coming from
Western companies. The long leadtimes required
for Western manufacture and for shipment to
the compressor station sites are likely to delay
the installation of many units until 1980 or 1981.
The Soviets may raise the capacity of the first
Urengoy-Vyngapur-Chelyabinsk line to its pro-
jected 33 billion cu m/year by 1980 through a
crash program, although this is not likely. [147]
Capacity on the other two systems is unlikely to
carry the remainder of the 139 billion cu m. In
fact, the three systems may move only 115 billion
to 120 billion cu m, causing most of the predicted
Soviet gas production short-fall in 1980.
Beyond 1980, the Tyumen' gas industry's de-
velopment will start to concentrate on deposits
further north. Urengoy and the smaller fields
now undergoing initial development will receive
additional drilling during 1981-85. Zapolyarny
and Yamburg, however, are the most likely
targets for new, intensive development in that
period. [ 148 ]
Because permafrost conditions are worse at
those fields than at Medvezh'ye and Urengoy
and because lack of infrastructure will again
constitute a serious problem, investment in
Tyumen' gas in 1981-85 will increase sharply
over that for 1976-80. At least 2 billion rubles
will go into infrastructure alone. Yet heavier
investment probably will bring neither Yamburg
nor Zapolyarny production near full capacity.
Soviet technology may prove unable to deal
rapidly with harsher permafrost conditions, in
both field development and pipeline construction.
The latter may again become the leading bottle-
neck, since existing Tyumen' pipeline systems
will require substantial expansion to handle
Yamburg and Zapolyarny gas. Improvement of
Soviet ability to manufacture and install large-
diameter pipe and compressors is possible beyond
1980, but such progress probably will be slow.
Infrastructure, drilling, and pipelaying problems
could prove even worse at the Kharsavey and
Bovanenko fields on the forbidding Yamal Pen-
insula, where development is unlikely to produce
significant additions to the Soviet gas supply
until the late 1980s.
Annual Capital Investment in Northern Region Gas
Projects as Percent of Total Gas Industry Investment
' Not all projects accounted for here strictly involved Tyumen'
Oblast gas. However, most investment, particularly in the later
years shown, was most likely tied to that region's gas industry.
Source: Ekonomika gazovoy promyshlennosti, no. 8 (1977),
p. 36.
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Tyumen' Oblast Gas Industry'
Reserves
(A + B + C,)
Production
Reserves/
Billion Cubic
Meters
Percent of
USSR Reserves
(Billion Cubic
Meters)
Percent of
USSR Output
Production
Ratio
1960
50.2
2.2
0
0
1961
50.2
2.0
0
0
1962
70.1
2.5
0
0
1963
130.1
4.2
0
0
1:964
200.3
6.2
0
0
1965
300.3
8.4
0
0
1966
400.8
11.2
0.6
0.4
668
1967
895.8
20.4
5.2
3.3
172
1968
4,030.6
42.8
8.2
4.8
492
1969
4,914.3
40.7
9.1
5.0
540
1970
6,834.9
56.5
9.2
4.6
743
1971
9,252.3
58.7
9.3
4.4
995
1972
10,608.7
58.9
11.4
5.1
931
1;973
11,797.4
60.4
15.8
6.7
747
1974
13,749.5
61.3
21.8
8.4
631
1975
15,490.0
63.0
36.8
12.7
421
1976
17,000.0
61.0
44.0
13.7
386
1977
NA
NA
67.9
19.6
NA
'Sources: Brentz, Ekonomika gazodobyvayushchey promyshlennosti, p. 28; Geologiya, bureniye i
razrabotka gazovykh mestorozhdenii, no. 4 (1977), p. 3; Ekonomicheskaya gazeta, no. 24 (1978), p. 1.
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Major Gasfields of Tyumen' Oblast 1
Surface
Thickness
(Meters)
Year
covered
Reserves'
(Billion Cubic
Meters)
Depth of
Producing Zones
(Meters)
Temperature
(Degrees
Centigrade)
Pressure'
(Kilograms
per Square
Meter)
Porosity '
(P
Permeabili
ty ?
Methane
Content
Well Yields
(Thousand Cubi
Output in 1977
Urengoy
Yambur
350-500
1966
5,000
1,1003,100
32-88
ercent)
(Millidarcies)
(percent)
c
Meters Per Day)
Production
Wells Drilled
(Billion Cubic
Meters)
g ..................
Zapolyarnyy
Medvezh'ye ..............
Kharsavei ..................
350-400
400-450
350-600
Thickness
k
1969
1965
1967
1974
3,000
2,000
1,548
1,000
1,000-1,200
1,100-1,300
1,0601,210
1,500-1,600
70-78
27
28-35
48-52
119
114
128
114
155
1
2530
Up to 37
2437
24-35
950-1,750
Up to 3,632
10-7,654
400-800
84-98
NA
98
99
1,000
200-700
150-250
1
000
45
NA
NA
1
Bova
k
un
nown
-
63
NA
NA
NA
,
U
t
1
000
00
nen
o
Thickness
1971
1
000
p
o
,
NA
Semakov
Komsomol'sk ........
unknown
Thickness
unknown
Thickness
unknown
200-250
1971
1974
1966
,
541
498
457
570-1,500
NA
NA
85
NA
20
NA
NA
89
NA
NA
NA
NA
NA
NA
NA
NA
NA
Gubkin
Pestsov
120-200
Th
1965
353
0-1,000
665-780
30
21
99
77
25-30
Up to 6,000
97
43-1
195
Vyngapur ..................
ickness
unknown
200-250
1974
1968
300
292
NA
920-1
040
NA
NA
2535
NA
Up to 7,000
NA
96
NA
,
270-867
NA
Yubilenoye ................
Solineask ..................
Novyy Port
Mesoyaklta ..............
350-4L5
360450
350-450
360450
1969
1970
1965
1967
221
161
100
44
,
1,025-1,180
2,250-2,450
900-2,100
790900
50
24-49
13
103
112
240
87-182
78
NA
NA
NA
10-20
NA
NA
NA
65-150
NA
NA
NA
79-92
450-686
Up to 5,200
300-500
45-1,100
NA
NA
NA
NA
0
0
NA
' Fields included were selected because th
,
20-32
1-500
92-98
150
55
0
ey
poste large reserves and/or because significant data were available.
'Thickness of tundra and permafrost in meters
-A + B + C,. Most reserve figures for West Siberian fields include B + C, only.
'Pressure exerted on the gas within the reservoir.
? The Proportion of a reservoir rock's total volume which is occupied by the space between the mineral grains.
The degree to which a rock will permit the gas to pas through it.
3.0
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Comparison of Delivered Costs
Rubles per
Producing
Thousand Cubic
Area
Pipeline Used
Meters
Tyumen' Oblast ......
Nadym-Moscow
16-18
Shatlyk Field ..........
Central Asia-Center
12-13
Komi ASSR ..............
Ukhta-Center
8
' Soviet calculations. Does not include capital charge. Source:
Ekonomika gazovoy promyshlennosti, no. 2 (1975), p. 12.
Allocation of Capital Investment at Selected Gasfields'
Area of Investment
Gazli
(Uzbek SSR)
North
Stavropol'
Medvezh'ye
(Tyumen' Oblast)
Total ............................................................
100.0
100.0
100.0
Wells ........................................................
48.5
38.4
15
Collection lines ......................................
26.5
43.6
18
Collection stations ..................................
9.5
2.4
14
Roads .........................................................
4.9
5.4
14
Other ........................................................
10.6
10.2
9
General regional improvement 8 .........
0
0
30
' Source: Ekonomika gazovoy promyshlennosti, no. 2 (1975), D. 13.
Q Including housing and other living facilities.
Average
Fixed Capital/
Initial
Output
Depth
Production
Production
Production
Reserves
per Well
of Producing
Ratio
Cost,
(Billion Cubic
(Billion Cubic
(Thousand Cubic
Zones
(Rubles/Thousand
(Rubles/Thousand
Field
Meters)
Meters)
Meters/Day)
(Meters)
Cubic Meters)
Cubic Meters)
Shebelinka ........................
30
550
500
2,000
2.8
0.31
Gazli ................................
26
460
700
850-1,150
1.9
0.28
North Stavropol' ..............
15
229
360
825
2.4
0.32
Medvezh'ye ......................
65
1,548
1,500
1,200
22.8
1.60
' Data for the,first three fields represent the period when each was at peak production. Medvezh've data are Soviet projections for peak performance expected
to begin in 1974. Source: Ekonomika gazoooy promyshlennosti, no. 2 (1975), p. 13.
' Sebestoimosi', without a capital charge.
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GAS PROCESSING AND REFINING
Treatment of extracted gas before its transport
by pipeline is becoming increasingly important to
the Soviet gas industry. Several problems are
developing in routine gas processing-the collec-
tion and preparation of natural gas for trans-
port-in Central Asia and West Siberia. At a
growing number of fields in those two leading
gas-producing regions, improved equipment is
required (a) to collect gas under extremely high
temperatures and, in the case of Central Asia,
high pressure and (b) to remove impurities such
as hydrates and carbon dioxide. Significantly
expanded automation of that equipment is also
needed in desert and permafrost areas where
there is a shortage of skilled labor.
Of particular importance to the gas industry,
however, are processing of associated gas and
natural gas refining. Moscow wants to reduce the
waste of associated gas by enlarging the oil
industry's capacity to separate the gas extracted
with oil and to prepare it for pipeline transport. It
also wants to increase through expanded refining
capacity the natural gas byproducts-such as
propane, butane, sulfur, carbon black, and stable
condensate-available for use in chemical pro-
duction and in other industries.
Associated Gas
One of the weakest facets of Soviet gas pro-
duction is recovery of associated gas, which has
grown only slowly (see table J-2). As extraction
of associated gas increased along with the rapid
expansion of oil production the share of the total
processed fell from 70 percent in 1965 to 59
percent in 1975, when 20 billion cu in was flared
(table D-1). In contrast, about 87 percent of all
gas extracted outside the USSR in 1974 was
processed or reinjected. Although processed
associated gas contributed only 10 percent of
national gas output, an accelerated expansion of
processing capacity over the past decade could
have brought the Soviets much closer to fulfilling
production plans.
Moscow has attached considerable importance
to expanding the use of associated gas during the
current five-year plan. Processing is expected to
increase by more than 40 percent to reach 40
billion to 45 billion cu in by 1980. [ 149] Key sites
for additional plants are the Tyumen' oil region
and the Kazakh and Turkmen oilfields along the
east Caspian coast. Processing capacity is al-
ready considerable in older oil-producing regions
such as the Tatar ASSR, the Ukraine, the
Caucasus, and the Kuybyshev district (see table
D-2).
The Soviets will not easily reach the 1980 goal
for processing associated gas. Moreover, even if
they could, it would not end flaring of substantial
amounts of gas. The Ministry of the Petroleum
Industry, which is responsible for almost all
production of associated gas, has consistently
moved slowly in constructing associated gas pro-
cessing facilities. With minimal cooperation be-
tween the oil and gas ministries, investment in
plants has been undercut by lags in equipment
supply, in construction, and in use of the latest
technology. An average of seven to eight years
passes between an oilfield's first output and the
installation of an associated gas processing
unit.1150] This slow pace is likely to continue
despite apparent Soviet interest in accelerating
installation. A call for rapid growth of processing
capacity in the 1971-75 plan [151] was followed
by only 47-percent fulfillment. None of the three
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West Siberian plants scheduled for that period
were completed. The region's first such unit, a
4-billion-cu m-per-year facility at Nizhnevar-
tovsk, was not finished until early 1976. [152]
Five plants are scheduled to be completed in
West Siberia by 1980-two of them additional
plants at Nizhnevartovsk to handle gas from the
large Samo,tlor oilfield. [153] However, con-
struction is falling behind schedule, possibly be-
cause of a :'lack of intetministry coordination.
Completing; the West Siberian plants will be
important, Since roughly 10 percent of the re-
gion's plan arget of 155 billion cu m for 1980 is
to come fro associated gas output. Even if West
Siberia's 1 80 goal for ' recovery of 16 billion
cu m of associated gas [154] is reached, capacity
will fall far Short of that required to recover all of
the associated gas being extracted in the area by
that time. Ilfthe plan is seriously underfulfilled,
West Siberia's recent annual flaring rate of 7
billion to 8I billion cu m [155] probably will not
decline.
Natural as Refining
Natural ;gas refining by the Ministry of the
Gas Industry has grown substantially since 1970
(see table D-3). By early 1976, refining was done
by six Gas Ministry plants: facilities in Moscow,
Ukhta, and Azerbaijan refine natural gas and
condensate; a Shebelinka plant handles conden-
sate; and a plant in Mubarek (Uzbek) and one at
the Orenburg field both conduct sulfur removal.
[156] Once the Orenburg plant reaches full
capacity-in 1978-79 according to plans for the
Orenburg-East Europe pipeline project (see ap-
pendix F)-refining should easily meet the 1980
plan of 31.5 billion cu m.
However, total refining capacity probably is
not expanding as rapidly as it should to keep pace
with needs. Large plants for handling condensate
in northern Tyumen' Oblast probably will not be
available until the early 1980s. Production asso-
ciations in Central Asia, where the bulk of
reserves may prove highly sulfurous, have not
increased refinery capacity quickly enough, and
one Turkmen newspaper has even recommended
discovery of new, low-sulfur deposits rather than
investing further in new refining facilities, [157]
Flaring of Associated Gas '
Billion Cubic Meters
1965
................................................
7.1
1966
................................................
7.8
1967
................................................
9.0
1968
................................................
10.9
1969
................................................
12.4
1970
................................................
14.6
1971
................................................
15.9
1974
................................................
19.0
1975
................................................
20.0
' Sources: Review of Sono-Soviet Oil (September 1970), p. 7;
(March 1972), p. 4; (May 1975), p. 22; Ekonomika gazovoy
promyshlennosti, (February 1976), p. 7.
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Output of Associated Gas by Oil Production Associations'
Million Cubic Meters
USSR .............................. 22,958
Ministry of Petro-
leum Industry .. 22,911 24,915 25,685 26,430 27,590 28,566
Tyumen ................. 105 142 270 646 877 1,663
Tatar ...................... 3,882 4,125 4,236 4,243 4,323 4,398
Bashkir ................ 1,364 1,333 1,371 1,408 1,446 1,469
Kuybyshev .......... 2,167 2,131 2,119 2,024 1,974 2,022
Perm' .................... 936 1,011 1,064 1,064 1,103 1,127
Mangyshlak .......... 125 123 144 497 780 1,247
Turkmen .............. 1,344 1,356 1,431 1,443 1,729 1,922
Ukraine ................ 2,157 2,496 2,543 2,689 2,766 2,883
Grozny .................. 4,252 4,768 4,509 4,084 3,954 3,058
Caspian .................. 1,536 1,972 2,263 2,690 3,036 3,381
Orenburg .............. 60 74 78 90 101 218
Komi ...................... 413 473 496 490 502 469
Belorussia ........... 178 295 401 413 511 568
Stavropol' ............ 692 760 805 827 835 836
Lower Volga ........ 873 1,088 1,351 1,299 1,114 1,021
Azerbaijan ............ 1,003 984 956 932 918 803
Krasnodar' ............ 653 670 668 674 666 666
Udmurt ................. 7 4 4 4 22 8
Sakhalin ................ 388 308 216 201 227 198
Dagestan ................ 490 484 451 382 386 275
Saratov .................. 203 230 224 253 244 266
Uzbek .................. 75 80 77 70 66 59
Kirgiz .................... 6 4 4 2 0 0
Tadzhik ................ 4 5 5 6 9 9
Ministry of the Gas
Industry ............ 47 52 62 52 31 7
Condensate ................................. 2,236 3,259 4,410 4,951 5,442
Resulting products
Liquid products # ....................... 449 627 858 997 1,052
Stable condensate ...................... 1,539 2,298 3,147 3,631 3,863
Carbon black ............................. 54.9 55.8 56.6 58.1 59.0
Sulfur .......................................... Negl Negl Negl 0.7 270
' Ministry of the Gas Industry. Source: Ekonomika gazovoy promyshlennosti, no. 8 (1975), pp. 26-27.
2 Including propane and some butane.
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Development of underground gas storage sites
has increased substantially in the past decade,
but gas in storage is still inadequate to prevent
seasonal shortages in many consuming centers or
to improve overall pipeline use. In the USSR,
most stored gas is kept underground in depleted
gasfields and in water-bearing strata-
aquifers-located in the European USSR and in
the Caucasus regions. The number of active
storage sites increased from 10 to 25 during
1965-75 [158] (and to 26 by early 1977 [159]),
with total storage capacity rising from 0.7 billion
cu m in 1960 to 39.5 billion cu m in 1975.
However, the volume of recoverable gas in stor-
age increased only from 5 percent of consump-
tion (2.5 billion cu m) in 1960 to 6 percent of
consumption (18.3 billion cu m) in 1975 (see
table J-22).
The sizable fluctuations in demand between
summer and winter require a much larger reser-
voir capacity than exists now in the European
USSR. Gas is usually in short supply in De-
cember-March and in surplus during May-
August. During the winter of 1975-76, for exam-
ple, 13 billion cu m were withdrawn from stocks
to meet increased seasonal demand.[160] A
larger storage capability would make possible
storage of surplus gas in the summer and thus
ensure greater wintertime reliability of gas sup-
plies for household and industrial users. It would
also permit pipelines to operate at optimal
average pressures-requiring less compressor
power-rather than being geared to peak
demand.
Industry planners are calling for an increase in
the volume of stored recoverable gas to 45 billion
cu m (10-12 percent of demand) by 1980.[161]
However, finding additional aquifers, exhausted
gas deposits, or salt cavities near major trunk-
lines or distribution networks is difficult. A large
percentage-in some cases about one-half-of
the gas pumped into underground reservoirs may
be lost because of the Soviet use of flat (rather
than domed) structures which lack structural
closure for containment of the gas.[ 162] Because
storage is made more economical by using reser-
voirs of more than 1 billion cu m, the need to find
large sites has become more urgent. The immi-
nent exhaustion of several gas and oil fields in
the Ukraine and Caucasus, however, will ease
this shortage somewhat in the near future.
Numerous additional problems persist. Re-
sources have been overextended because too
many projects have been started at the same
time, with few of them receiving adequate alloca-
tions of manpower and materials. Delivery of
supplies to some sites has been delayed for up to
a year. [ 163] Moreover, many new projects have
been particularly hard hit by mismanagement
and poor construction, with equipment or pipe-
line breakdowns dragging out construction and
the beginning of operations. [ 164]
Capacity expansion at existing storage facili-
ties also has lagged seriously. Of the 1,600 gas-
injection wells at depleted fields available for
storage use in 1975, only 700 (44 percent) had
been put into operation.[165] In addition, gas
processing units at several reservoirs have not
been completed.
Despite these problems, gas storage will con-
tinue to grow through 1980. New facilities under
construction in the Ukraine, Caucasus, Uzbek,
and Moscow regions will raise total storage
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capacity by several billion cu m. Storage in the national goal of an increase of 27 billion cu m in
Ukraine alone-where production is starting to recoverable capacity by 1980 will not be reached.
decline-is planned to increase 8 billion cu m, up Even if it is, the Soviets will still not possess an
from 2.9 billion cu m in 1975. [ 166] If the adequate national storage system until sometime
obstacles described above persist, however, the in the 1980s.
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The most ambitious joint CEMA operation
ever undertaken is the construction of a 2,750-
km pipeline that will bring gas from the Oren-
burg field in the Urals to Eastern and Western
Europe.[167] Begun in mid-1975, the project
involves cooperation by six East European na-
tions and the Soviet Union in laying a 1,420-mm
line from the Orenburg gasfield, in the Urals, to
the Soviet-Czechoslovak border. In return for
their assistance, the six CEMA participants for
12 years will receive annually a total of 15.5
billion cu m of Orenburg gas. The pipeline, now
called "Soyuz," is scheduled for completion in
late 1978. Once the line reaches its full capacity
of 28 billion cu in in 1980 or 1981, it may also be
used to fulfill supply commitments to Western
Europe.
The project as initiated in 1974 was estimated
to cost $4 billion to $5 billion and to entail
extensive participation by the six CEMA co-
signers. Five of them (Czechoslovakia, Bulgaria,
Hungary, East Germany, and Poland) were to
construct parts of the pipeline, each financing
and laying approximately 500 km of pipe and
constructing related compressor stations. The
trunkline as a whole is to be equipped with 22
compressor stations. Romania was to finance
French construction of the third sulfur-removal
unit at Orenburg itself, enabling the field to
reach its peak capacity of nearly 45 billion cu m.
Beginning in 1980, the five pipelaying countries
are each to receive annually 2.8 billion cu m of
gas; Romania is to receive 1.5 billion cu m.
The Orenburg project has relied heavily on
Western imports. In addition to French installa-
tion of the Orenburg field equipment, [168]
Moscow has probably obtained most of the ap-
proximately 1.7 million tons of required large-
diameter pipe from Western companies. Equip-
ment related to pipeline construction and
operation has also been purchased from the
West. [ 169] In the project's single largest pur-
chase, the Soviets after year-long negotiations
contracted with West Germany and Italy for the
158 turbine units needed in the line's compressor
stations. [ 170]
A serious problem facing pipelaying progress
is the CEMA participants' failure to send the
required numbers of skilled laborers. By 1977,
the five pipe-building nations had sent an esti-
mated 12,000 to 14,000 workers, [ 171 ] less than
one-half their original quota of 30,000 work-
ers. [ 172] Only Poland was still scheduled to
complete its entire pipeline section and compres-
sor stations.[173] The others have arranged for
lesser construction responsibilities, with compen-
sating increases in their financial support of the
project. [ 174] Romania, which had no labor com-
mitment, is fulfilling its initial pledge of invest-
ment in the Orenburg field. To fill the labor gap,
Soviet crews apparently have been taken off
other pipelaying jobs and transferred to the
Orenburg line. The more experienced Soviet
workers may increase the pace of the line's
construction, but their transfer may leave crews
on other important pipelaying projects short-
handed.
Construction of the pipeline itself may be
finished by the late-1978 deadline, although
completion in early 1979 is more likely. The
buildup of the line's compressor power may take
longer than planned to reach full capacity.
Lengthy negotiation for the compressor units has
delayed complete Western delivery of the units
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until late 1978. This probably will not give the line will be able to satisfy the commitment to
Soviets time to transport and install all of them supply 15.5 billion cu m annually to Eastern
by January 1980. However, the Soviets should be Europe by 1981 and perhaps to fulfill some of
able to complete enough stations by late 1978 or Moscow's gas export contracts with Western
early 1979 to bring a little gas into Eastern Europe.
Europe for ceremonial purposes. The Orenburg
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Under a contract signed in late 1975, the
Soviet Union will serve as a middleman in
Iranian sale of gas to Europe. The 20-year
agreement, [175] which will take full effect in
1984, stipulates that the USSR will:
(1) Import 17 billion cu m of Iranian gas
annually.
(2) Use that gas for its own consumption,
(3)
primarily in the increasingly gas-poor
Caucasus.
Export 15 billion cu m of its own gas to
Western Europe and Czechoslovakia,
probably via the Orenburg line (see ap-
pendix F) and the Central Asia-Center
and Urengoy-Center trunkline systems.
Moscow will benefit considerably from the
deal. The difference of 2 billion cu m between
Soviet imports from Iran and exports to Europe
will be considered a transit fee. The Soviets
apparently will also receive an undisclosed
amount of hard currency per each 1,000 cu m of
gas delivered to the West European importers.
[176] This latter fee could earn Moscow several
billion dollars over the agreement's 20-year run.
Initial deliveries will begin in 1981. The gas
will come from Iran's Kangan field and be piped
1,400 km along the second Iranian Gas Trunk-
line (IGAT-II) to the Soviet border at Astara.
Western firms and the Soviets will aid Iran in
the line's construction, [177] which was sched-
uled to begin in late 1977. Consisting of
1,220-mm and 1,420-mm pipe, IGAT-II in Janu-
ary 1981 is to begin operations considerably
below capacity. Only a few billion cu m will be
delivered to Western Europe in that year. As the
trunkline reaches its capacity of 27 billion cu m,
Czechoslovakia will begin receiving its share (3.6
billion cu m) in 1983 and the West European
countries their full amount in 1984: West Ger-
many (5.7 billion cu m), France (3.8 billion cu
m); and Austria (1.86 billion cu m). Czechoslo-
vakia, included in the agreement only in De-
cember 1976, [178] is being repaid in gas for
building a new trunkline across its territory that
will bring West Europe's share to the Austrian
border. Iran itself intends to consume domesti-
cally 10 billion cu m of the gas annually trans-
mitted by IGAT-II.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
LIQUEFIED NATURAL GAS
LNG exports could eventually add $2 billion
to $3 billion annually to Soviet hard currency
earnings under two proposed East-West ven-
tures. However, LNG is unlikely to play a
significant role in Soviet gas exports for at least
another decade. Progress has been slow in negoti-
ations for Western participation in developing
liquefaction systems for export of gas from West
Siberia and from the Soviet Far East. Talks,
under way intermittently since 1973, have been
hung up over LNG pricing, constraints on US
Export-Import Bank financing of LNG facilities,
and possible US Government limits on LNG
imports. Given the long leadtimes required for
installing the proposed LNG facilities, signifi-
cant Soviet LNG exports probably could not
begin until the late 1980s even if agreement on
either proposal was reached within the next year.
Yakutsk
The most active of the two ventures proposed
is one formally agreed upon in December 1974,
whereby the United States, Japan, and the
USSR would develop an LNG system using gas
from deposits near Yakutsk in the Soviet Far
East. US and Japanese backing of Soviet invest-
ment-originally estimated at $4 billion to $5
billion-would go toward (a) exploration and
development of the Vilyuy field, (b) construction
of a 4,350-km pipeline of 1,200- or 1,420-mm
pipe, and (c) installation of a liquefaction plant
near Ol'ga. [179] In return the Soviets over a 20-
year period would ship 10 billion cu m of LNG to
both Japan and the United States annually.
[ 180] The arrangement would make the best use
of Yakutsk gas, which is too far from major
Soviet consuming centers to make pipeline trans-
port economical.
Negotiations on the project have been moving
at a low level, but progress has been made. In
March 1976 Japan and a US consortium made
loans of $25 million each for the exploration
phase of the project. [181] Talks on initiation of
the costly development phase, however, have
been slowed by Export-Import Bank financing
limitations and by the thus far indequate results
from Soviet exploration of the Yakutsk depos-
its-reserves of only 800 billion cu m had been
proved by mid-1978. [182] Until Yakutsk gas
reserves reach a level deemed sufficient to justify
a 20-year export agreement-reportedly 1 tril-
lion cu m [183]-the Western concerns are
unwilling to commit themselves to loaning addi-
tional sums for the project. [184] The venture's
total cost is currently estimated at about $7
billion. [185]
North Star
Talks are in limbo on the North Star venture
involving liquefaction of gas from the large
Urengoy field in West Siberia. Originally pro-
posed by a US consortium, North Star was to
provide for annual delivery of 21 billion cu m of
gas to the US east coast over a period of 25
years. [186] US credits were to provide for (a)
gathering lines at Urengoy; (b) a 1,220-mm,
2,460-km pipeline bringing the gas to an ice-free
port on the Kola Peninsula; (c) a liquefaction
plant and auxiliary facilities at the port; and (d)
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
a fleet of 20 L LNG tankers. [187] The total cost
was estimated at $7 billion to $8 billion in mid-
1970s' prices. [188]
No real move toward an agreement has been
made. After: 1975, when Congressional limita-
tions on US Export-Import Bank credits to Mos-
cow forced the US consortium to drop discussion
of the project, a West European group picked up
the negotiations in January 1976.[1891 Under a
revised proposal France, West Germany, and
possibly the United Kingdom would provide the
pipe, equipment, and financing. [190] If the plan
were agreed upon, the European and US consor-
tiums would divide the annual LNG deliveries of
21 billion cu m. However, the European group
and Moscow have not yet hammered out a price.
Exports of gas from Urengoy for the North Star
project do not appear likely until the late 1980s
and then only if agreement on the venture is
reached within the next few years. In the absence
of a guaranteed US market for Soviet LNG it is
doubtful that the USSR would invest in liquefac-
tion facilities because the Urengoy gas could be
exported to Europe more expeditiously and at
lower cost by pipeline, without liquefaction.
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 -Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Major Natural Gas Pipelines'
West Siberian systems
Urengoy-Medvezh'ye-Punga- V uktyl-
Torzhok-Ivatsevichy-Uzhgorod
Urengoy-Medvezh'ye-Punga-Nizhnaya
Tura-Izhevsk-Moscow
Nizhnevartovsk-Parabel'-Tomsk-
Kemerovo-Novokuznetsk
Balyk-Nizhnevartovsk
Soleninskoye-Messoyakha-Noril'sk
Central Asian systems
Bukhara-Chelyabinsk
200
300
Diameter
(Millimeters)
NA
720-1,020
Maximum
Capacity
(Billion
Number of Cubic Meters
Lines per Year)
NA
11
The "Northern Lights" system, built originally in the 1960s to
transport gas from the Vuktyl Field, will link up with the
Tyumen' Fields via two 1,420-mm Punga-Vuktyl lines. Four
lines are planned between Vuktyl-Torzhok by 1980, with a
potential capacity of 70 bem, approximately 50 bem of which is
to be available for Tyumen' gas, 20 for Komi ASSR gas. Most of
current capacity goes to Moscow and Leningrad regions.
The "Urengoy-Center" system, which until 1977 had carried all
northern Tyumen' gas to the Urals and Moscow. Additions of
1,420-mm and 1,220-mm lines along the Punga-Nizhnaya
Tura and Nizhnaya Tura Center sections will probably increase
capacity to 75 bem.
The "Urengoy-Chelyabinsk" system, which began contruction in
late 1976. It will form the initial section of a multiline system
extending through the central European USSR to the Czecho-
slovak border. Completion of the first line is sched uled for
1978-79 but capacity by 1980 probably will not reach project-
ed maximum.
Construction began in 1976 and is behind schedule but the line
should reach full capacity by 1980. It will transport associated
gas from the Samotlor Field to the Kuzbass region. A branch to
Novosibirsk is also under construction.
Operational in 1976.
Northernmost gas pipeline in the world. Current capacity is 6.4
bem; construction of third line began in 1976.
Branch of Northern Lights system; Vologda-Cherepovets section
completed in 1975.
Bukhara-Nizhniy Tagil
2,300
1,020
1
10
Bukhara-Moscow-Leningrad
3,200
1,020
1
10
Bukhara-Moscow
2,400
1,220
1
15
Okarem-Beynev-Ostrogozhsk
2,550
1,020-1,220
1
20
is
"C Footnote at end of Table.
The "Central Asia-Urals #1" system, completed in 1964. Short
section will be expanded to 1,220-mm in 1978.
The "Central Asia-Urals #2" system, completed in 1966.
"Central Asia-Center #1," completed in 1967.
"Central Asia-Center #2," finished in 1970.
"Central Asia-Center #3"; to reach full capacity of 20 bern in
1977.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Major Natural Gas Pipelines' (Continued)
"Central Asia-Center #4," completed in 1975. Two lines run from
Shatlyk to Khiva where they are joined by Central Asia-Center
lines #s 1 and 2.
Mubarek-Alma Ata
Bukhara-Tashkent-Chimkent
Mayskoye-Bayram Ali-Ashkhabad-
Bezmein
Mubarek-Kelif-Afghanistan
Kelif-Dushanbe
Uzen-Shevchenko
Samarkand-Leninabad-Kokand,-
Fergana-Kuvasai
Palvantash-Changyrtash-Andizhan
Khodziabad-Fergana-Andizhan-
Namangan-Kokand
1,325
770
500
275
300
150
529-1,020
529- 720
529
820
NA
520
17
2
2
4
NA
2
2
NA
NA
First line completed in 1970; second in 1975.
Completed in 1959.
Completed in 1970.
Completed in 1967.
First line completed in 1967; second in 1974.
Completed in 1967.
First section, Kuvasai-Fergana, completed in 1959;. Fergana-
Leninabad completed in 1963; the Samarkand-Leninabad sec-
tion became operational in 1964.
Probably operational by mid-1960s.
Various sections completed during late 1950s and early 1960s; a
branch also runs from Andizhan to Mailisu via Osh.
Urals systems
Orenburg-Kremenchug-Uzhgorod
28
The "Orenburg Project," to be completed in late 1978 or early
1979; full capacity likely by early 1980s; a joint CEMA
construction project which will bring gas from the Urals to the
Orenburg-Novopskov
1,200
1,220
12
Czech border for export to Eastern and Western Europe.
Completed in 1976.
Dombarovsk-Orenburg
400
1,220
15
To link Central-Asia-Urals lines with Orenburg lines; construction
Tuymazy-Shkapovo-lshimbay-
Magnitogorsk
3
began in 1976; began operation in 1977.
First line completed from Shkapovo in 1958; second line finished
in 1966.
9
Completed in 1966; construction of a second line of 1,220-mm
diameter extending to Kazan' and Gor'kiy is planned during
1976-80.
Minnebayevo-Kazan'
280
305-529
1.5
First line completed in 1954; second in 1963.
Kazan-Gor'kiy
375
305
0.5
Line completed in 1957.
Minnebayevo-Tuymazy-Ufa
260
250-355
0.5
Completed in 1953. A second Minnebayevo-Tuymazy line was
Saratov-Moscow
790
305
0.5
completed in 1960.
Completed in 1946. A second line was built during 1965-70.
Buguruslan-Kuybyshev-Pukhvintsnevo
300
305
0.5
Completed in 1943.
Orenburg-Zainsk
500
1,020
8.5
Completed in 1972.
Orenburg-Kuybyshev
400
1,000
NA
Completed in 1974.
Mokrous-Kuybyshev-Tol'yatti-Ulyanovsk
600
529-820
3.5
Completed in 1970.
Saushinskaya-Log-Volgograd
125
529
1.5
Completed in 1957.
Kotlas-Kirov
360
720
3
Branch of Northern Lights line.
Chusavoy-Berezniki-Solikamsk
180
529
1.5
Operational in 1967.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007.7
Major Natural Gas Pipelines' (Continued)
Ukraine systems
Dashava-Bratislava (Czechoslovakia)
4
Known as the " Bratsvo" (brotherhood) line; completed in 1967 to
29
allow expansion of gas exports in Eastern Europe.
Second Bratsvo line completed in 1975. A third line is under
Dashava-Minsk-Ivatsevichi- V ilnyus-Riga
1,385
529-720-820
6.8
construction.
Completed in 1962.
Shebelinka-Bryansk
875
720
10
Completed in 1960.
Shebelinka-Dnepropetrovsk-Odessa
700
720
10
First line completed in 1966; second line opened in 1976.
Dashava-Kiev-Bryansk-Moscow
1,300
529
1.5
Completed in 1949. Second Dashava-Kiev line completed in 1959.
Kiev-Western Ukraine
550
1,020
16
First line built in 1970 to Kamenka-Bugskaya; second line to
Belsk-Sumy-Shchors-Gomel-Minsk
725
425
NA
Dolina in 1975.
Completed in 1962.
Shebelinka-Kiev
500
1,020-1,420
23
First line completed in 1964; second in 1970; third in 1975.
Valday-Pskov-Riga
600
1,020
7
Completed in 1972.
L'vov-Ivano-Frankovsk-Chernovotsy
300
NA
2
Operational in 1961.
Odessa-Kishinev
180
NA
1
Operational 1967.
Razdel'naya-Izmail (to Bulgaria via
Romania)
355
1,020
8.5
Operational in 1976.
Shebelinka-Slavyansk-Lisichansk-Lugansk
260
720
3.7
Operational in 1969.
Nikolayev-Kherson
75
720
4
Built in early 1960s.
Strelkovskoye-Dzhankoy-Simferopol
160
NA
NA
Operational in 1976.
Krasnodar'-Kerch-Simferopol-Sevastopol
575
820
NA
Built in early 1960s.
Poltava-Kremenchug-Krivoy Rog
275
720-1,020
8.5
Completed in 1967.
Shebelinka-Dnepropetrovsk
200
720-820
8
First line completed in 1957; second line in 1961.
Central systems
Moscow Ring
420
820-1,020
20
First ring completed in 1963; second ring finished in 1976.
Saratov-Gor'kiy-Cherepovets
1,200
529-720-820
6
Completed in 1961.
Stavropol'-Moscow
1,275
720-1,020
10
First line completed in 1956; second in 1960.
Tallinn-Leningrad
350
229-529
3
Shale gas lines; first completed in 1948; second in 1963.
Serphukov-Leningrad
800
720-1,020
17
First line completed in 1959; second in 1968.
Moscow-Tula
180
529
1.5
Completed in 1954.
Shebelinka-Ostrogozhzk
250
1,020
8.5
Operational in 1961.
Ostrogozhsk-Gubkin
150
NA
NA
Line #1 completed in 1975; second line in 1976.
Rostov-Taganrog
80
720
8
First line finished in 1956; second completed in 1958.
Taganrog-Zhdanov
100
520-720
8
Completed in 1959.
Taganrog-Donetsk-Slavyansk
230
520-720
4
Completed in 1960.
Leningrad-Vyborg-Imatra-Finland
180
1,420
20
Operational in 1974.
Riga-Liepaja
180
NA
NA
Operational.
Panevezys-Klaipeda
200
NA
NA
Operational in 1968.
Roslavl-Smolensk-Dorogobuzh
320
NA
NA
Operational in 1966.
Gor'kiy- V ladim ir-Moscow
350
820
6
Operational in 1967.
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Caucasus and Trans-Caucasus systems
Ahwaz (Iran.)-Astara (USSR)-Kazi
Magomed
12
Known as the Iranian Gas Trunkline (IGAT I) system, it opened
8
in late 1970 to allow importation of Iranian natural gas; 200 km
of the line lies within the USSR. A second line, IGAT II, is under
construction; it will use 1,220 and 1,420 pipe; initial operation is
planned for 1981, reaching full capacity (27 bem) by 1984.
First and second lines built in 1963-64; a third line was under
10
construction in 1975.
First line completed in 1960, second in 1970, third line was under
Krasnodar'-Rostov-Lugansk-Serpukhov
1,200
820-1,020
30
construction in 1975.
Completed in 1962. A second line was built in the mid-1960s.
Stavropol'-Groznyy
425
529-720
4.8
Completed in 1959.
Karadag-Baku
50
529
1.5
Completed in 1956.
Karadag-Sumgait-Siazan
115
500-720
1.8
Completed in 1964. A second line runs from Sumgait to Siazan.
Far East systems
Mastakh-Tas Tumus-Yakutsk-Pokrovsk-
Bestyakh
1.5
Tas Tumus-Yakutsk completed in 1967; branches to Pokrovsk and
Mastakh added in 1969 and 1972, respectively.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
STATISTICAL TABLES
Million Cubic Meters
1928 .................................. 304
1929 .................................. 330
1950
5
8
4
0
1
8
1930 ................................. 520
- ..............
.
.
.
1951
6
3
1
4
2
2
1931 .................................. 845
................
.
.
.
1952
6
4
4
1
2
3
1932 .................................. 1,049
................
.
.
.
1953
6
9
4
5
2
4
1933 .................................. 1,063
................
.
.
.
1954
7
5
4
9
2
6
1934 .................................. 1,531
................
.
.
.
1935 .................................. 1,806
1955 ................
9.0
5.9
3.1
1936 .................................. 2,050
1956 ................
12.1
8.4
3.7
1937 .................................. 2,179
1957 ................
17.6
14.3
3.3
1938 .................................. 2,208
1958 ................
28.0
22.6
5.4
1959
35
3
28
8
6
5
1939 .................................. 2,531
................
.
.
.
1960
45
3
37
6
7
7
1940 .................................. 3
219
................
.
.
.
,
1961
59
0
50
4
8
6
1941 .................................. 3,463
................
.
.
.
1962
73
5
63
5
10
0
1942 .................................. 2,045
.. ..............
.
.
.
1963
89
8
77
7
12
1
1943 .................................. 1,852
................
.
.
.
1944 .................................. 2,405
1964 ................
108.6
94.4
14.2
1945 .................................. 3,278
1965 ................
127.7
111.2
16.5
1966
143
0
125
2
17
8
1946 .................................. 3,902
................
.
.
.
1967
157
4
138
6
18
8
1947 .................................. 4,830
................
.
.
.
1948. ................................. 5,219
1968 ................
169.1
149.5
19.6
1949 .................................. 5,396
1969 ................
181.1
159.5
21.6
1950 .................................. 5,761
1970 ................
197.9
174.9
23.0
1971 ................
212.4
187.4
25.0
' Including associated gas. Source: Elliot, Soviet Energy
1972 ................
221.4
195.6
25.7
Balance, p. 38.
1973 ................
236.3
209.8
26.5
1974 ................
260.6
233.0
27.6
1975 ................
289.3
260.7
28.6
1976 ................
320.6
NA
NA
1977 ................
346.0
NA
NA
1980E ............
435.0
390-395
40-45
' Gas extracted along with oil and then separated. Sources: A. K.
Kortunov, Gazovaya promyshlennost' SSSR, Moscow (1967), p. 62;
Brentz, Ekonomika gazodobyvayushchey promyshlennosti, pp. 33-
34.
2 Plan.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Allocation of Capital Investment by the Ministry of the Gas Industry
1966-70 1971-75 1970 1975
Million Million Million Million
Rubles' Percent Rubles' Percent Rubles' Percent Rubles' Percent
Total .......................................................... 4,049.0 100.0 10,903.5 100.0 1,189.6 100.0 2,966.9 100.0
Geological exploration ......... 63.3 1.6 335.0 3.1 10.9 0.9 78.0 2.6
Extraction .............................................. 1,019.1 25.2 3,139.4 28.8 332.7 28.0 878.5 29.6
Development drilling ........................ 330.0 8.2 701.9 6.4 114.9 9.7 170.6 5.8
Field preparation ............................ 689.1 17.0 2,437.5 22.4 217.8 18.3 707.9 23.9
Pipeline transport .................................. 2,597.2 64.1 6,445.8 59.1 695.8 58.5 1,718.5 57.9
Natural gas processing .......................... 59.4 1.5 478.0 4.4 36.7 3.1 102.8 3.5
Underground storage .......................... 44.6 1.1 116.9 1.1 7.2 0.6 62.0 2.1
Machine building ................................ 61.5 1.5 131.4 1.2 22.7 1.9 57.2 1.9
' In current prices, as opposed to "comparable" prices, the Soviet pricing concept analogous to constant prices in the West. "Comparable"
prices are deflated with an index based on a given year (until recently, 1967, and now 1975). They do include, however, some current factor
prices (for example, for new types of machinery introduced after the base year). Source: Margulov, Razvitiye gazovoy promyshlennosti, p. 17.
Value of Fixed Capital, Ministry of the Gas Industry
Average Annual
1975 Increase Increase,
1970 1971 1972 1973 1974 1975 Over 1970 1971-75
Million Rubles' Percent Million Rubles' Percent Million Rubles' Percent Million Rubles' Percent Million Rubles' Percent Million Rubles' Percent (Percent) (Percent)
Total ........................ ._.......... 6,207.1 100.0 7,084.4 100.0 8,121.9 100.0 9,457.3 100.0 11,090.4 100.0 13,720.0 100.0 121.0 17.2
Drilling ................................ 81.0 1.3 92.0 1.3 118.0 1.5 122.0 1.3 134.0 1.3 141.0 1.0 74.1 11.7
Extraction .__._..._...__._..... 903.6 14.6 1,116.2 15.8 1,295.4 15.9 1,537.1 16.3 1,952.6 17.6 2,441.0 17.8 170.1 22.0
Pipeline transport ................ 4,824.0 77.7 5,423.0 76.7 6,209.0 76.4 7,219.1 76.3 8,290.0 74.7 10,213.0 74.4 111.7 16.2
Natural gas processing ........ 56.4 0.9 79.4 1.1 91.4 1.1 103.7 1.1 154.8 1.4 280.0 2.0 396.5 37.8
Machine building .............. 112.8 1.8 111.6 1.6 123.3 1.5 129.7 1.4 137.6 1.2 152.0 1.1 34.8 6.1
7 aoz9 z~.,0 ~
Other .. .. .. 229.3 3 3 a.i 262.z ^ 3.7 204.8 3.5 345 ~ .7 3.7 =42,.~~ 3.8 493.~ 3.6 115.0 16.5
' In current prices. Although the lack of data in constant prices prevents accurate comparisons, the table is useful for inferring trends because of (a) the relatively short time period involved and (b) the
magnitude of the increase in value of fixed capital stock. These two considerations suggest that price inflation did not account for most of the increased value. Source: Margulov, Razvitiye gazovoy
promyshlennosti, pp. 17-18.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Share of Major Fuels in Total Fuels Production'
Percent
1955 ........................ 2.4
1956 ........................ 3.0
1957 ........................ 4.0
1958 ........................ 5.5
1959 ........................ 6.4
1960 ........................ 7.9
1961 ........................ 9.7
1962 ........................ 10.9
1963.. ..................... 12.4
1964 ........................ 13.9
1965 ........................ 15.5
1966., .... - - .............. 16.5
1967 ........................ 17.2
1968 ........................ 17.9
1969 ........................ 18.3
1970 ........................ 19.1
1971 ........................ 19.5
1972 ........................ 19.5
1973 ........................ 19.9
1974 ........................ 20.8
1975 ........................ 21.8
1976 ........................ 23.1
1977' ...................... 24.0
21.1 64.8
23.3 63.2
24.5 61.2
26.3 58.8
28.1 56.1
30.5 53.9
32.4 50.5
34.2 48.8
34.8 45.9
35.1 44.2
35.8 42.7
36.7 40.7
37.8 39.4
39.2 38.0
39.9 37.3
41.1 35.4
41.8 34.6
42.3 34.0
43.2 33.0
43.8 32.1
44.1 30.8
45.0 29.0
45.0 28.0
Sources: Narodnoye khozyaystvo SSSR, various issues.
' Natural and associated.
'Including gas condensate.
CIA estimate.
Natural Gas Production, Trade, and
Apparent Consumption'
Billion Cubic Meters
Net Apparent
Production Exports' Consumption
1958 ............... 28.0
1960 ................ 45.3
1961 ................ 59.0
1962 ................ 73.5
1963 .............. 89.8
1964 ................ 108.6
1965 ................ 127.7
1966 ................ 143.0
196T. .............. 157.4
1968.... ........... 169.1
1969 ................ 181.1
1970 ................ 197.9
1971... ............. 212.4
1972 ................ 221.4
1973 ................ 236.3
1974 ................ 260.6
1975 ................ 289.3
1976.... ........... 320.6
1980 ................ 435.0'
0.2
0.2
0.3
0.3
0.3
0.3
0.4
0.8
1.1
0.2
0.6
-0.3
-3.6
-6.0
-4.6
2.1
6.9
14.0
40.9
27.8
45.1
58.7
73.2
89.5
108.3
127.3
142.2
156.3
168.9
180.4
198.2
215.9
227.3
240.9
258.5
282.4
306.6
394.1
' Sources: Vneshnyaya torgovlya and Narodnoye khozyaystvo
SSSR, various issues.
2 A minus indicates net imports.
' Soviet plan.
Gas Consumption by Region
Billion Cubic Meters
Region 1960 1965 1970 1975
USSR' .......................... 44.4 120.3 179.1 239.5
RSFSR 23.9 75.6 117.3 160.5
........
Of which; - -
Northwest ........ 1.8 6.6 9.5 13.4
Central............ 6.5 22.5 32.0 38.5
Central-Black
Earth ......... 0.9 2.7 4.6 5.6
Volga 8.8 18.0 22.9 36.5
North Caucasus 4.4 11.2 15.3 18.2
Urals ............... 0.5 10.2 26.2 38.7
Ukrainian SSR ...... 14.6 34.6 49.6 58.3
Belorussian SSA ...... 0 2.3 2.9 4.0
Transcaucasus ...,.... 5.9 7.8 9.3 16.7
' Excluding Georgian SSA, Azerbaijan SSR, Armenian SSR. The USSR total
would still be smaller than the "apparent consumption" totals presented in
table J-6, because the data presented here do not include losses and use by the
gas industry itself. The exclusion of these latter two categories distinguishes
"actual consumption"-presented here-from "apparent." Source: Margulov,
Razvitiye gazovoy promyshlennosti, p. 8.
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Gas Consumption, by Economic Sector '
Percent of Total Percent of Total
Sector 1958 1960 1965 1968 1970 1975 Consumption in 1958 Consumption in 1975
USSR ............................ 27.8 45.1 127.3 168.9 198.2 282.4 100 100
Household-
municipal............ 2.9 5.7 14.9 21.1 25.3 34.0 10 12
Industry .................... 14.3 25.4 73.5 96.8 109.1 156.1 51 55
Chemicals ............ 0.3 1.9 6.2 10.7 12.9 22.8 1 8
Metallurgy ............ 1.7 5.1 18.4 27.4 30.3 41.1 6 15
Machinery and
metalworking 1.8 3.4 12.8 16.2 19.1 24.2 6 9
Construction
materials and
construction ...... 2.4 4.5 14.0 17.5 19.3 26.5 9 9
Oil and gas x ...... 5.6 6.0 12.4 13.6 10.6 20.5 20 7
Light industry .... 0.2 0.6 2.0 2.2 2.5 3.8 1 1
Food industry ...... 0.6 1.2 4.2 5.7 6.1 8.2 2 3
Other .................. 1.7 2.7 3.5 3.5 8.3 9.0 6 3
Electric
power plants ...... 9.6 12.2 35.7 44.1 52.7 67.8 35 24
Transport .................. 0.1 0.2 0.4 0.6 0.7 1.3 Negl Negl
Agriculture .............. Negl 0.1 0.2 0.4 0.7 1.9 Negl 1
Other', ..................... 0.9 1.5 2.6 5.9 9.2 21.3 3 8
'Sources: Robert W. Campbell, The Economics of Soviet Oil and Gas, Baltimore (1968), p. 214; Review of Sino-Soviet Oil (May 1970),
p.18; Margulova Bazvitiye gazovoy promyshlennosti, p. 14.
2 Including gas, used for production of carbon black.
8 Represents primarily losses and use by the gas industry (e.g., for the operation of compressor stations on gas trunklines). Total for USSR
therefore equals the "apparent consumption" data presented in table J-6.
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Share of Natural Gas in Boiler and Furnace Fuel,
by Region'
USSR ........................................ 14.9 21.3 27.9
European regions .............. 22.0 26.4 32.2
North-West .................... 9.2 16.9 20.9
Baltic .............................. 3.4 11.0 10.7
Belorussia ........................ 15.8 16.6 18.2
Central Region .............. 25.7 32.3 37.2
Central Chernozem ... 14.1 19.1 24.3
Volga-Viatka .................... 15.5 21.8 22.2
North Caucasus .............. 33.0 47.0 46.5
Volga Region .................. 26.9 33.9 29.8
Transcaucasus ................ 46.6 41.3 38.6
Ukraine .......................... 21.3 29.2 35.0
Urals ................................ 1.7 15.6 37.8
Eastern regions .................... 2.6 5.5 12.1
West Siberia .................. 0 0 0.7
East Siberia ...................... 0 0 1.4
Far East .......................... 2.1 2.4 4.7
Kazakhstan ...................... 2.3 2.8 12.6
Central Asia .................... 18.0 37.7 57.0
' Source: A. E. Probst and Ya. A. Mazover, eds., Razvitive i
razmeshchenive toplivnoy promyshlennosti (1975).
Growth of Gas Reserves (A + B + C,)
and Reserves/ Production Ratio'
Reserves Reserves/
(End of Year) Production Production
1955............ 692.4 9.0 76.9
1956 ............ 862.3 12.1 71.3
1957 ............ 1,095.6 17.6 62.2
1958............ 1,584.8 28.0 56.6
1959............ 2,202.4 35.3 62.4
1960............ 2,336.1 45.3 51.6
1961............ 2,547.4 59.0 43.2
1962............ 2,786.5 73.5 37.9
1963............ 3,061.6 89.8 34.1
1964 ............ 3,219.7 108.6 29.6
1965 ............ 3,563.9 127.7 27.9
1966 .......... 4,381.5 143.0 30.6
1967 ........... 7,753.0 157.4 49.3
1968 ............ 9,422.5 169.1 55.7
1969 ............ 12,085.9 181.1 66.7
1970 ............ 15, 750.1 197.9 79.6
1971............ 17,992.9 212.4 84.7
1972............ 19,530.9 221.4 88.2
1973............ 22,413.6 236.3 94.9
1974............ 24,579.0 260.6 94.3
1975............ 25,800.0 289.3 89.2
1976............ 28,000.0 320.6 87.3
' For an explanation of what is included in the reserves categories
(A + B + C,), see notes to table 2, above. Sources (reserves data):
for 1957-66, Kortunov, Gazovaya promyshlennost' SSSR, p. 35; for
1967, Gazovaya promyshlennost', no. 1 (1968), pp. 13-18; for 1970,
Oil and Gas journal (7 September 1970), p. 51; for 1972, Oil and
Gas journal (22 January 1973), p. 64; for 1955-56, 1971, and 1973,
Brentz, Ekonomika gazodobyvayushey promyshlennosti, p. 25; for
1974, Oil and Gas Journal (19 July 1976), p. 42; for 1975, Margulov,
Razvitiye gazovoy promyshlennosti, p. 5; for 1976, Geologiya
bureniye i razrabotka gazovykh mestorozhdenii, no. 4 (1977), p. 3.
Source (production data): Narodnoye khozyaystvo SSSR, various
issues.
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Natural Gas Reserves (A + B + C,) of Producing Regions I
Region
1951
1956
1960
1965
1966
1967
1968
1971
1073
1974
USSR ....................................
173.0
692.4
2,202.4
3,219.7
3,563.9
4,381.5
7,753.0
15,750.1
19,530.9
22,413.6
RSFSR ..............................
89.2
450.8
972.3
1,472.8
1,693.3
2,380.6
5,525.2
12,316.1
15,796.9
18,102.2
Komi ASSR ..................
20.8
21.2
18,1
18.4
38.3
73.7
136.2
405.6
439.4
367.1
Bashkir ASSR ..............
0
0.4
23.1
18.4
30.3
44.1
46.2
54.5
50.5
58.2
Perm' Oblast ................
0
0
0
11.1
24.2
34.2
39.2
40.8
56.5
61.5
Kuybyshev Oblast ........
3.1
6.7
4.6
9.0
11.1
8.1
8.0
4.1
3.9
3.4
Orenburg Oblast ..........
4.3
5.1
16.9
26.1
25.3
30.0
29.4
1,124.9
1,657.3
2,108.0
Saratov Oblast ..............
21.3
53.1
66.9
74.0
70.8
68.1
72.1
59.4
57.1
62.2
Volgograd Oblast ........
6.4
47.5
141.6
110.4
89.5
92.7
91.0
85.7
79.3
77.3
Astrakhan Oblast and
Kalmytskaya ASSR
0
3.9
11.6
48.6
46.9
17.3
18.7
20.4
17.6
16.4
Rostov Oblast ..............
0
0
0
5.2
4.0
4.0
4.0
8.9
7.9
9.3
Krasnodar' Kray ..........
0
75.6
359.4
458.9
465.3
427.6
419.4
89.7
255.8
256.0
Stavropol' Kray ............
26.8
225.7
249.6
251.2
234.4
228.9
222.1
198.6
180.9
171.3
Dagestan ASSR ............
0.5
0.1
0.1
26.4
42.7
53.4
63.1
35.0
28.7
31.2
Checheno-Ingush ASSR
4.9
2.7
2.0
8.6
8.6
8.5
8.5
8.3
5.8
8.2
Sakhalin Oblast ............
1.1
4.7
7.4
44.4
48.8
57.4
70.1
57.5
59.6
68.2
Tyumen' Oblast ..........
0
4.1
50.2
300.3
400.8
895.8
3,850.4
9,252.3
11,797.4
13,749.5
Krasnoyarsk Kray ........
0
0
0
0
0
0
5.0
149.8
280.1
302.9
Tomsk/Novosibirsk
Oblast ........................
0
0
0
15.1
54.3
107.7
182.7
231.2
247.2
256.3
Irkutsk Oblast ..............
0
0
0
20.5
20.5
20.5
20.5
12.9
12.9
12.9
Yakutsk ASSR ..............
0
0
20.8
26.1
77.5
208.6
238.6
259.5
234.5
316.2
Ukraine SSR ....................
70.3
148.7
544.8
643.5
655.2
636.5
663.2
810.0
848.4
868.7
Azerbaijan SSR ..................
9.1
52.2
115.7
60.5
53.9
46.2
45.2
80.3
97.0
122.6
Kazakh SSR ......................
0
0
1.2
41.8
91.7
131.8
173.8
177.3
165.9
167.6
Uzbek SSR ........................
4.4
4.8
544.2
697.6
666.7
663.6
690.1
796.8
913.7
949.6
Turkmen SSR ..................
0
35.5
13.1
282.2
376.4
486.5
605.6
1,522.3
1,963.7
2,158.6
Tadzhik SSR ........................
0
0.3
3.4
9.2
12.8
20.3
32.1
31.7
29.5
29.0
Kirgiz SSR ............................
0
0.1
7.7
12.1
13.9
16.0
17.8
15.6
15.8
15.3
'Sources: Brentz, Ekonomika gazodobyvayushchey promyshlennosti, p. 24; Kortunov, Gazovaya promyshlennost' SSSR (1967), p. 35; and Gazovaya promyshlennost', no.
1 (1968).
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Results of Exploratory Drilling
Exploratory
Drilling'
(Thousand Meters)
Additions to
Reserves (A + B + C,)
(Billion Cubic Meters)
Reserves of Gas Added
per Meter Drilled
(Thousand Cubic Meters)
1956
............
315
182
577.8
1957
............
602
251
416.9
1958
............
746
517
693.0
1959
............
918
653
711.3
1960
...........
1,032
179
173.5
1961
............
1,500
270
180.0
1962
............
1,618
313
193.5
1963
............
1,734
365
210.5
1964
............
1,804
267
148.0
1965
............
1,942
474
244.1
1966
............
2,260
959
424.3
1967
............
2,514
3,529
1,403.7
1968
............
1,392
1,839
1,321.1
1969
............
2,606
2,844
1,091.3
1970
............
1,853
3,862
2,084.2
1971
...........
2,826
2,455
868.7
1972
............
2,763
1,759
636.6
1973
...........
2,839
3,119
1,098.6
1974
............
2,851
2,426
850.9
1975
2 ..........
2,944
1,510
512.9
' Drilling done by the Ministry of the Gas Industry and the Ministry of Geology. The latter ministry does
exploratory drilling for both oil and gas.
8 Estimated.
Natural Gas Production, by Region
1960..........
USSR
45.3
West
Siberia
0
Orenburg
Oblast
0.5
Komi
ASSR
0
Central
Asia
0.8
Ukraine
14.3
Caucasus
18.4
Other
11.3
1961..........
59.0
0
NA
0
1.5
20.6
22.0
14.9
1962..........
73.5
0
NA
0
2.5
26.2
28.1
16.7
1963..........
89.8
0
NA
0
3.4
31.6
32.7
22.1
1964..........
108.6
0
NA
0
10.2
35.6
37.8
25.0
1965..........
127.7
0
0.6
0
17.9
39.4
43.6
26.2
1966..........
143.0
0.6
NA
0.6
24.1
43.6
45.0
29.1
1967..........
157.4
5.2
NA
0.6
29.4
47.4
45.5
29.2
1968..........
169.1
8.2
NA
0.6
34.8
50.9
45.0
29.6
1969..........
181.1
9.1
NA
1.9
39.8
55.4
42.9
32.0
1970..........
197.9
9.2
0.8
6.5
48.0
60.9
45.2
27.2
1971..........
212.4
9.3
3.0
10.0
54.1
64.7
41.1
30.2
1972..........
221.4
11.4
5.0
13.0
59.5
67.2
35.9
29.4
1973..........
236.3
15.8
7.0
16.0
71.5
68.2
32.4
25.4
1974..........
260.6
21.8
10.5
17.0
82.5
68.3
28.5
32.0
1975..........
289.3
36.8
19.6
20.0
94.0
68.7
25.8
24.4
1976..........
320.6
44.0
31.4
21.0
104.5
68.7
24.2
26.8
1980' ......
420.0
140.0
45.0
22.0
112.0
50.0
21.0
30.0
1985' ......
560.0
300.0
45.0
20.0
100.0
30.0
15.0
50.0
' CIA projections.
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Major Gas-Producing Regions' and
Their Share of Total Soviet Gas Production
Billion
Billion
Billion
Billion
Region
Cubic
Meters
Percent
Cubic
Meters
Percent
Cubic
Meters
Percent
Cubic
Meters
Percent
USSR 8
.....................
45.3
100.0
127.7
100.0
197.9
100.0
289.3
100.0
Ukraine SSR ........
14.3
31.5
39.4
31.0
60.9
31.0
68.2
23.6
Turkmen SSR ......
0.2
0.9
1.2
0.9
13.1
6.6
52.3
18.1
Uzbek SSR ............
0.4
1.0
16.5
13.0
32.1
16.2
37.1
13.0
Tyumen' Oblast
NegI
Negl
Negl
Negl
9.2
4.7
35.5
12.3
Orenburg Oblast
0.5
1.0
0.6
0.4
1.3
0.7
20.1
7.0
Komi ASSR .........
1.0
2.2
0.8
0.7
6.8
3.4
18.5
6.4
Stavropol' Kray ....
8.2
18.0
15.3
12.0
16.4
8.3
11.4
4.0
Azerbaijan SSR......
5.8
13.0
6.2
4.8
5.5
3.0
9.3
3.2
Krasnodar' Kray
5.1
11.2
23.1
18.1
24.7
12.5
7.9
2.7
Volgograd Oblast
2.6
5.6
7.1
5.5
4.0
2.0
2.9
1.0
Saratov Oblast ......
2.5
5.6
6.4
5.0
3.4
1.7
1.0
0.3
' Regional data do not include natural and associated gas produced by the Ministry of the Oil Industry.
Source: Margulov, Razvitiye gazovoy promyshlennosti, pp. 28-39.
'Sum of regional production is less than USSR total.
Natural Gas Production, by Union Republic'
1960 ................
USSR
45,303
RSFSR
24,412
Ukraine
14,286
Azerbaijan
5,841
Uzbek
447
Turkmen
234
Kazakhstan
39
Tadzhik
NA
Kirgiz
41
1961 ................
58,981
30,641
20,585
6,304
1,014
243
46
NA
148
1962 ................
73,525
38,274
26,158
6,605
2,033
254
46
NA
155
1963- ..............
89,832
48,232
31,564
6,627
2,989
255
40
NA
126
1964 ................
108,566
56,579
35,645
6,122
9,321
693
37
NA
146
1965 ................
127,666
64,257
39,362
6,180
16,474
1,157
29
52
155
1966 ................
142,962
69,042
43,617
6,173
22,566
1,265
46
90
163
1967 ................
157,445
74,781
47,443
5,771
26,638
2,226
83
245
256
1968 ................
169,101
78,347
50,942
4,993
28,988
4,843
321
366
291
1969................
181,121
80,993
55,403
4,938
30,769
7,535
680
438
341
1970 ................
197,945
83,321
60,877
5,521
32,094
13,107
2,092
388
367
1971 ................
212,398
87,483
64,669
5,822
33,653
16,899
2,747
447
383
1972 ................
221,386
87,400
67,236
6,880
33,739
21,312
3,525
498
395
1973 ................
236,326
87,841
68,161
8,399
37,104
28,645
4,847
520
396
1974 ................
260,553
100,046
68,318
9,151
37,064
39,272
5,372
496
323
1975. - - . .........
289,268
116,667
68,700
9,890
36,500
51,776
5,000
410
325
1976 ................
320,600
136,000
68,700
10,989
36,000
62,600
5,200
400
330
' USSR total is sometimes greater than sum of Republic production because of a residual not identified in Soviet statistics. Source:
Narodnoye khoayaystvo SSSR, various issues.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Output/Capital Ratios for Gas Extraction
in the Ministry of the Gas Industry'
Gas Production
Association
1971
1972
1973
1974
1975
Gas Ministry ....................
163
134
121
106
96
Turkmen ......................
345
295
267
232
174
Uzbek ............................
381
228
223
183
163
Ukraine ........................
187
154
149
130
113
Orenburg ........................
123
75
40
91
94
Nadym 8 ........................
0
66
104
97
90
Stavropol' ......................
199
151
124
98
77
Komi ..............................
167
110
91
74
67
Yakutsk ..........................
54
17
25
30
24
Noril'sk ..........................
35
32
30
22
20
' Source: Ekonomika gazovoy promyshlennosti, no. 1 (1977), p. 5.
In current prices, excluding a capital charge.
Data refer primarily to Medvezh'ye field.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Average Cost
Gas Production Share of USSR Midyear Value of Extraction
Production (Billion Cubic Production Total Gas Active of Capital Stock Output/Capital (Rubles/Thousand
Association Meters Q) (Percent) Wells Wells (Million Rubles) Ratio 9 Cubic Meters)
Ukraine
1970 .................... 55.0
1975 ................... 58.5
Turkmen
1970 .................... 11.8
1975 .................... 47.0
Uzbek
1970 .................... 31.5
1975 .................... 36.6
Tyumen'
1970 .................... 9.2
1975 ..................... 33.5
Orenburg
1970 ....................
1975 ....................
Kuban
(Krasnodar')
28 1,142 960 308.8
20 1,438 1,257 515.8
6 84 55 34.0
16 299 260 269.2
16 393 276 97.0
13 533 412 219.4
5 84 53 84.7
12 181 153 407.0
0.8 Negl 20 6 8.1
18.3 6 174 136 192.4
1970 .................... 22.5
1975 .................... 5.8
Komi
1970 .................... 6.2
1975 .................... 17.8
Stavropol'
1970 .................... 15.7
1975 .................... 10.5
11 580 426 179.3
2 818 587 201.5
3 33 22 34.6
6 102 78 283.5
8 757 574 83.4
4 1,089 935 139.8
' Source: Margulov, Razvttiye gazovoy promyshlennosti, pp. 29-38.
s The actual total for a region may exceed that for the association itself.
Rubles of gas; per ruble of fixed reproducible assets in current prices (excluding transmission lines).
In current prices. Does not include a capital charge.
Average Annual Output per Gas Well '
1.08
0.48
0.170
1.07
2.09
0.35
1.05
0.73
2.04
0.23
1.00
1.08
0.65
0.95
0.151
1.46
0.64
1.29
0.59
1.59
0.119
0.91
0.18
5.47
115
1.17
0.41
1.70
1.14
0.44
0.46
1.54
USSR
Turkmen
SSR
' Tyumen'
Oblast
Komi
ASSR
Uzbek
SSR
Khar'kov Oblast
(Ukraine)
Stavropol'
Kray
Krasnodar'
Kray
1960..........
42.7
0
0
6.5
55.3
159.0
106.0
56.7
1965..........
58.7
0
0
3.7
133.0
133.2
77'.8
74.3
1967..........
55:2
107.7
179.6
4.0
115.0
105.0
63.5
63.7
1968..........
52:6
145.0
235.1
4.5
103.0
95.6
50.4
59.0
1969..........
47.8
166.1
202.0
15.2
97.4
83.2
33.2
52.5
1970..........
47.8
213.9
169.3
53.9
99.4
83.2
27.4
44.5
1971..........
45:4
204.5
152.1
83.5
93.2
77.1
22,5
32.8
1972..........
44,.2
176.0
143.8
101.4
83.2
72.5
19.9
23.5
1973..........
41.6
188.1
158.1
136.2
85.0
69.3
16.6
16.3
' Brentz, Ekonbmlka, p. 110.
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Length of Gas Collection
Pipeline Networks,
End of Year
1960
..............................................
2,528
1961
...............................................
2,544
1962
...............................................
2,982
1963
...............................................
3,082
1964
.............................................
3,898
1965
.........................................
4,427
1966
...............................................
4,459
1967
................................................
5,673
1968
...............................................
8,219
1969
.........................................
9,692
1970
..............................................
10,964
1971
..............................................
11,232
1972
................................................
11,455
1973
.........................................
12,587
' Pipelines used for intrafield collection of gas in preparation for
transport via main trunklines to consuming centers. Source: Brentz,
Ekonomika gazodobyvayushchey promyshlennosti, p. 112.
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Development of Soviet Trunkline System
Commercial Gas
Commercial
Output/
1958............
Total Length
(Thousand
Kilometers)
12.2
Average Length
of Transports
(Kilometers)
543
Transported by
Trunkline 8
(Billion Cubic
Meters)
13.4
Gas Transported
as a Share of
Gas Output
(Percent)
48
Cost of Transport
via Trunkline I
(Rubles/Thousand
Cubic Meters)
226
Capital Ratio
for Trunkline
Transport 5
(Cubic Meters/Ruble) 9
NA
1959............
16.5
570
21.0
59
223
NA
1960............
21.0
589
32.8
72
221
35.4
1961............
25.3
601
41.9
71
207
37.9
1962............
28.5
611
53.6
73
194
41.0
1963............
33.0
616
68.6
76
159
46.4
1964 ............
37.1
644
87.7
81
160
47.3
1965............
42.0
656
112.1
88
168
46.2
1966...........
47.4
678
128.8
90
164
44.6
1967............
52.6
744
143.3
91
167
41.1
1968 ............
56.1
864
155.1
92
188
38.2
1969............
63.2
909
166.0
92
190
38.7
1970............
67.5
917
181.5
92
201
37.1
1971............
71.5
964
209.8
99
NA
36.0
1972............
77.7
1,004
219.9
99
NA
33.1
1973 ............
83.5
1,051
231.1
98
NA
30.2
1974............
92.1
NA
245.7
94
NA
29.6
1975............
99.2
1,285
279.2
96
304
26.5
Sources: for 1958-66, Kortunov, Gazovaya promyshlennost' SSSR, pp. 94, 100; for 1967-75, Narodnoye khozyaystvo SSSR, various issues.
Sources: for 1958-59, Kortunov, p. 94; for 1960-73, Khaskin, Osnovnyye fondy gazovoy promyshlennosti, p. 45; for 1975, Margulov,
Razvitlye gazovoy promyshlennosti, p. 45.
Sources: for 1958-74, Narodnoye khozyaystvo SSSR, various issues; for 1975, Margulov, p. 40.
Sources: for 1958-68, Kortunov, p. 103; for 1969, Review of Sino-Soviet Oil (September 1970), p. 11; for 1970 and 1975, Margulov, p. 49.
? Sources: for 1960-69, Khaskin, p. 45; for 1970-75, Margulov, p. 15.
In constant factor prices. Costs exclude, in part, full charge for use of capital.
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Distribution of Major Gas Trunklines, by Size'
Average
Total Length Diameter
(Kilometers) (Millimeters) 1,420 mm 1,220 mm 1,020 mm 820 mm 720 mm 630 mm 529 mm Other
Kilometers
1960.......... 20,983.2 553 0 0 670.5 2,263.6 6,164.4 64.3 4,091.7 7,728.7
1961.......... 25,328.9 574 0 0 1,276.6 3,130.6 7,413.4 64.3 5,099.6 8,344.4
1962.......... 28,492.1 581 0 0 2,020.0 3,155.8 8,267.1 64.0 5,763.1 9,221.1
1963.......... 33,032.7 605 0 0 3,703.0 3,382.0 9,301.1 73.0 7,195.0 9,378.6
1964' ...... 36,908.5 614 0 0 5,104.0 3,728.0 9,764.0 73.0 7,820.0 10,419.5
1965' ...... 42,279.2 628 0 0 7,528.0 4,014.0 10,460.0 120.0 8,268.0 11,889.2
1966' ...... 47,550.1 642 0 0 10,111.9 4,380.9 10,739.1 120.0 9,456.0 12,742.2
1968.......... 56,100.0 654 0 521.4 13,532.4 4,746.7 11,749.7 106.1 10,627.4 14,815.5
1970.......... 67,500.0 815 0 3,811.0 15,884.2 5,023.4 12,911.4 105.4 12,644.5 17,120.1
1971.......... 71,500.0 817 0 4,393.0 16,926.3 5,537.3 13,184.5 219.4 13,582.6 17,656.9
1972.......... 77,700.0 823 908.2 6,448.7 17,995.2 5,565.9 13,865.9 219.4 14,413.3 18,283.4
1973......... 83,500.0 914 1,570.7 8,874.5 18,500.0 5,977.7 14.176.0 209.4 15,075.0 19,116.7
1975.......... 99,200.0 1,012 3,552.0 15,086.0 20,647.0 7,016.0 15,074.0 142.0 16,225.0 21,458.0
19802 ...... 134,600.0 1,082 15,000.0 18,230.0 26,050.0 7,155.0 14,265.0 NA NA 53.900.0 ?
' The sum of Soviet published data for pipelines of various sizes does not agree precisely with Soviet published data for national totals in the
years 1964-66. Hence the discrepancy between data shown above and in table J-20. Sources: for 1960-66, Gal'perin, Razvitiye i perspektivy
transporta gaza, p. 33; for 1968, Review of Sino-Soviet Oil (June 1970), p. 18; for 1971-73, Khaskin Osnovnyye fondy gazovoy
promyshlennosti, p. 59; for 1970 and 1975, Margulov, Razvitiye gazovoy promyshlennosti, p. 13; for 1980, Ekonomika gazovoy
promyshlennosti, no. 7 (1976), p. 30, and Ekonomieheskaya gazeta, no. 6 (1977), p. 2.
? Plan total; lengths by size are estimated.
? Including 630 mm and 529 mm.
Gas Storage Capacities'
Plan
1960
1965
1970
1971
1972
1973
1974
1975
1980
Number of underground
storage sites ..........................
4
10
15
15
16
18
25
25
35
Total storage capacity .........
0.7
5.2
12.3
14.1
16.0
19.9
30.8
39.5
68.6
Volume of gas in storage ......
0.4
3.6
10.1
12.0
13.7
18.3
30.8
39.5
68.6
Amount recoverable ................
0.3
2.4
6.0
6.2
7.2
8.0
11.0
18.3
45.0
Amount injected ......................
0.2
1.8
5.5
5.6
5.8
7.8
10.4
14.3
30.7
Amount withdrawn ...............
0.1
1.0
3.6
5.0
4.7
6.4
NA
8.6
NA
Net additions ..........................
0.1
0.8
1.9
0.6
1.1
1.4
NA
5.7
NA
' The relationships among the line entries in this table are in some cases inscrutable. Except for "Net
additions," data are taken from the Soviet literature lacking explanatory notes. "Total storage capacity" is
the maximum volumetric size of the storage reservoirs. "Volume of gas in storage" is apparently a function
of the number and types of storage sites in the inventory and not a function of new additions as one might
expect. As depleted fields are converted and added to the inventory of storage reservoirs, gas previously left
behind in these fields as unrecoverable is apparently added to the "Volume of gas in storage." An unknown
percentage of these additions becomes recoverable-and is reflected in "Amount recoverable"-as
reservoirs pressures are increased during the injection of gas into storage. "Net additions" is the excess of gas
stored (injected) over gas withdrawn. Source: Orudzhev, Gazovaya promyshlennost', pp. 70-71.
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Capacity of Gas Compressor Stations '
Number of
Compressor Stations
Aggregate Capacity
(Thousand Kilowatts)
Compressor Station Power
per 100 km of Pipeline
(Thousand Kilowatts)
1959
............
18
130.2
0.79
1960
............
21
256.7
1.22
1961
............
28
564.7
2.23
1962
............
37
910.2
3.20
1963
............
52
1,190.0
3.60
1964
............
71
1,638.8
4.17
1965
............
81
1,868.8
4.42
1966
............
85
2,069.0
4.35
1967
............
96
2,460.0
4.66
1968
............
119
2,990.7
5.38
1969
............
124
3,077.3
4.97
1970
............
130
3,400.7
5.15
1971
............
136
3,873.7
5.48
1972
............
154
4,348.3
5.64
1973
............
180
5,309.8
6.49
1974
............
222
7,000.0
7.60
1975
............
286
8,000.0
8
13
1976E .......... 328
9,800.0
.
9.42
' Sources for 19.60-73, Khaskin, Osnovnyye fonds gazovoy promyshlennosti, p. 17; for 1974, JPRS, no. 66236 (28 November 1975); for 1976,
Margulov, Razvitiye gazovoy promyshlennosti, p. 9; for 1976, Gazovaya promyshlennost', no. 3 (1976), pp. 1-3.
E Plan.
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Aggregate Trade in Natural Gas'
1960..........
1961..........
1962..........
1963..........
1964..........
1965..........
1966..........
1967..........
1968..........
1969..........
1970..........
1971..........
1972..........
1973..........
1974..........
1975..........
1976..........
Million
Cubic
Meters
Percent of
Production
Million
Rubles
Million
Cubic
Meters
Million
Rubles
Million
Cubic
Meters
million
Rubles
million
US$
Million
Cubic
Meters
Percent of
Apparent
Consumption
Million
Rubles
Million
Cubic
Meters
242
0.5
1.7
242
1.7
0
0
0
0
0
0
242
272
0.5
1.9
272
1.9
0
0
0
0
0
0
272
300
0.4
2.1
300
2.1
0
0
0
0
0
0
300
301
0.3
2.1
301
2.1
0
0
0
0
0
0
301
295
0.3
2.0
295
2.0
0
0
0
0
0
0
295
392
0.3
2.7
392
2.7
0
0
0
0
0
0
392
828
0.6
5.7
828
5.7
0
0
0
0
0
0
828
1,291
0.8
18.1
1,291
18.1
0
0
0
207
0.1
1.1
1,084
1,729
1.0
24.3
1,587
22.5
142
1.8
2.0
1,500
0.9
8.0
229
2,664
1.5
36.8
1,882
26.9
782
9.9
11.0
2,030
1.1
10.9
634
3,300
1.7
45.8
2,344
33.7
956
12.1
13.4
3,556
1.8
13.9
- 256
4,555
2.1
61.2
3,127
43.1
1,428
18.1
20.1
8,136
3.8
48.4
-3,581
5,070
2.3
69.3
3,437
49.3
1,633
20.0
24.2
11,046
4.9
65.8
-5,976
6,837
2.9
92.0
4,862
69.9
1,975
22.1
29.8
11,414
4.7
84.5
-4,577
14,038
5.4
213.5
8,555
127.2
5,483
86.3
104.83
11,941
4.6
152.1
2,097
19,332
6.7
451.3
11,291
267.0
8,041
184.3
233.19
12,412
4.4
182.1
6,920
25,780
8.0
733.4
13,436
431.3
12,344
302.2
346.23
11,785
3.8
176.2
13,995
Source: Vneshnyaya torgovlya SSSR, various issues.
The USSR has been a net exporter of natural gas except in 1970-73 when imports from Iran and Afghanistan exceeded exports. Thereafter, deliveries under gas-for-pipe
barter transactions with several West European countries and increased capacity of export pipelines restored the USSR to its position as a net exporter.
9 Excluding Finland.
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Exports ..........................................
0.24
0.39
1.30
3.30
4.56
5.07
6.84
14.04
19.33
53.14
Eastern Europe ........................
0.24
0.39
1.30
2.34
3.13
3.44
4.86
8.56
11.29
33.62
Bulgaria ..................................
0
0
0
0
0
0
0
0.31
1.19
1.50
Czechoslovakia ....................
0
0
0.27
1.34
1.64
1.94
2.36
3.23
3.69
14.20
East Germany ........................
0
0
0
0
0
0
0.79
2.90
3.30
6.99
Hungary ................................
0
0
0
0
0
0
0
0
0.60
0.60
Poland ..................................
0.24
0.39
1.03
1.00
1.49
1.50
1.71
2.12
2.51
10.33
Western Europe ......................
0
0
0
0.96
1.43
1.63
1.98
5.49
8.04
19.52
Austria ....................................
0
0
0
0.96
1.43
1.63
1.62
2.11
1.88
9.63
Finland ................................
0
0
0
0
0
0
0
0.44
0.72
1.16
Italy ........ ..............................
0
0
0
0
0
0
0
0.79
2.34
3.13
West Germany ....................
0
0
0
0
0
0
0.35
2.15
3.10
5.60
Imports ..........................................
0
0
0.21
3.56
8.13
11.05
11.41
11.94
12.41
57.54
Afghanistan ............................
0
0
0.21
2.59
2.51
2.85
2.74
2.85
2.85
16.39
Iran ........................................
0
0
0
0.97
5.62
8.20
8.68
9.09
9.56
41.15
Net Trade .......................................
0.24
0.39
1.08
-0.26
-3.58
-5.98
-4.58
2.10
6.92
-4.40
' Source: Vneshnyaya torgovlya, various issues.
USSR: Projected Trade in Natural Gas, by Country'
Exports ...................................... 25.8
Eastern Europe ...................... 13.4
Bulgaria .............................. 2.2
Czechoslovakia .................. 4.3
East Germany .................... 3.4
Hungary.., ... ......... ....... .1.0
Poland ................................ 2.5
Romania .............................. 0
Yugoslavia .......................... 0
Western Europe .................... 12.4
Austria .................................. 2.8
Finland .............................. 0.9
France ................................ 1.0
Italy .................................... 3.7
West Germany .................. 4.0
Imports .................................... 11.8
Afghanistan ........................ 2.5
Iran ...................................... 9.3
Net Trade ................................ 14.0
32.7
37.3
45.3
55.5
196.6
77.8
16.0
17.5
24.0
30.6
101.5
43.1
3.5
4.0
5.0
6.3
21.0
8.5
4.5
5.0
5.5
6.3
25.6
10.0
4.0
4.0
5.5
6.5
23.4
7.0
1.0
1.0
2.5
4.0
9.5
5.4
3.0
3.5
4.5
6.0
19.5
8.1
0
0
1.0
1.5
2.5
2.1
0
0
0
0
0
2.0
16.7
19.8
21.3
24.9
95.1
34.7
2.8
2.8
2.8
2.8
14.0
4.0
0.9
1.0
1.0
1.4
5.2
1.0
1.5
2.0
2.0
4.7
11.2
7.7
6.5
7.0
7.0
7.0
31.2
7.0
5.0
7.0
8.5
9.0
33.5
15.0
12.9
12.9
13.0
14.6
65.2
31.0
2.9
2.9
3.0
4.0
15.3
4.0
10.0
10.0
10.0
10.6
49.9
27.0
19.8
24.4
32.3
40.9
131.4
46.8
' Actual for 1976. Source: Vneshnyapa torgovlya SSSR 1976, Moscow (1977). Trade estimates for the
years 1977-80 and 1985 are based on (a) known Soviet-West Europe trade agreements; (b) for Eastern
Europe, the trade arrangement under Orenburg pipeline agreement and assumed annual increments in gas
deliveries to certain CEMA customers; (c) scheduled increases in imports from Iran under the "trilateral
switch deal (see appendix G) and assumed slight increases in imports from Afghanistan.
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
Soviet Natural Gas Exports as a Percent of East European Gas Consumption
Billion Cubic Meters
Imports
From
the Soviet Imports as a
USSR Percent of Consumption
Bulgaria
1965 ................................ 0.07 0 0
1970 ................................ 0.47 0 0
1975 ................................ 1.19 1.19 100
Czechoslovakia
1965 ................................ 0.75 0 0
1970 ................................ 2.08 1.34 64
1975 ................................ 4.42 3.69 83
East Germany
1965 ............................... 0.15 0 0
1970 ................................ 1.30 0 0
1975 ................................ 11.30 3.30 29
Hungary
1965 ................................ 1.31 0 0
1970 ................................ 3.67 0 0
1975 ................................ 5.98 0.60 10
Poland
1965 ................................ 1.69 0.39 23
1970 ................................ 5.98 1.00 17
1975 ................................ 8.11 2.51 31
Romania
1965 ................................ 17.25
1970 ................................ 24.83
1975 ................................ 31.00
0 0
0 0
0 0
Total
1965 ................................ 21.22 0.39
1970 ................................ 38.33 2.34
1975 ................................ 62.00 11.29
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
SOURCE REFERENCES
1. The following section is based on lain F. Elliot, The Soviet Energy
Balance, New York (1974), pp. 14-18, and Jeremy Russell, Energy as a
Factor in Soviet Foreign Policy, Lexington, Mass. (1976), p. 59.
2. See the American Gas Association, Gas Facts, 1976 (1977), p. 23 for
recent US gas production data.
3. Most of the information in this paragraph is from Elliot, Soviet Energy
Balance, pp. 14-18.
4. Gazovaya promyshlennost', no. 8 (1977), p. 2.
5. R. D. Margulov et al., Razvitiye gazovoy promyshlennosti i analiz
techniko-ekonomicheskikh pokazateley, VNIIZ Gazprom, Moscow
(1976), p. 4.
6. S. A. Orudzhev, Gazovaya promyshlennost' po puti progressa, Moscow
(1976), pp. 33-35.
7. Margulov, Razvitiye gazovoy promyshlennosti, p. 17.
8. Agitator, no. 15 (1976).
9. The following paragraph is based on Robert W. Campbell, The
Economics of Soviet Oil and Gas, Baltimore (1968), p. 214, and
Margulov, Razvitiye gazovoy promyshlennosti, p. 14.
10. Margulov, Razvitiye gazovoy promyshlennosti, p. 4.
11. Ibid., p. 5, Geologiya, bureniye i razrabotka gazovykh mestorozhdeniy,
no. 4 (1977), p. 3, and Orudzhev, Gazovaya promyshlennost' p. 13.
12. For an overview of this development, see A.D. Brentz et al., Ekonomika
gazodobyvayushchey promyshlennosti, Moscow (1975), pp. 31-73;
Margulov, Razvitiye gazovoy promyshlennosti, pp. 18-39; and Orudz-
hev, Gazovaya promyshlennost', pp. 26-36.
13. Elliot, Soviet Energy Balance, p. 18.
14. Brentz, Ekonomika, p. 28, and Orudzhev, Gazovaya promyshlennost',
p. 12.
15. M. B. Ravich, Gaz i ego primeneniye v narodnom khozyaistvye,
Moscow (1974), pp. 136-145.
16. Gazovaya promyshlennost', no. 3 (1969), p. 5.
17. Gazovaya promyshlennost', no. 11 (1976), p. 6; and Pravda, (26
February 1977), p. 2.
18. Geologiya nefti i gaza, no. 5 (1975), p. 8.
19. Geologiya, bureniye i razrabotka gazovykh mestorozhdeniy, no. 14
(1977), p. 17.
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20. For an important, recent statement on exploration for oil and gas, see
Pravda (10 August 1977), p. 2.
21. Ekonomicheskaya gazeta, no. 28 (1977), p. 17.
22. The following paragraph is based on Review of Sino-Soviet Oil (June
1975), p. 17; Joint Publications Research Service (JPRS) no. 63298,
Translations on USSR Resources, no. 549 (29 October 1974), pp. 6-7;
and Orudzhev, Gazovaya promyshlennost', pp. 21-22.
23. Review of Sino-Soviet Oil (December 1970), p. 10.
24. Ekonomicheskaya gazeta, no. 6 (1977), p. 1.
25. See Brentz, Ekonomika, p. 28; Margulov, Razvitiye gazovoy promysh-
lennosti, pp. 29-32; and Orudzhev, Gazovaya promyshlennost', p. 34.
26. Pravda (13 December 1976), p. 1.
27. Ekonomicheskaya gazeta, no. 6 (1977), p. 2.
28. Turkmenskaya iskra (19 February 1977), p.2.
29. Gazovaya promyshlennost', no. 11 (1976), p.36. The Orenburg field
produced 34.6 billion cu m in 1977 (Gazovaya promyshlennost', no. 3
(1978), p. 2).
30. See the explanatory note on table 13 for the methodology used in
deriving these cost figures.
31. Margulov, Razvitiye gazovoy promyshlennosti, p. 17.
32. Brentz, Ekonomika, p. 108.
33. Margulov, Razvitiye gazovoy promyshlennosti, pp. 23-25.
34. Orudzhev, Gazovaya promyshlennost', p. 39; and JPRS no. 69777 (13
September 1977), p. 13.
35. G. Z. Khaskin et al., Osnovnyye fondy gazovoy promyshlennosti,
Moscow (1975), p. 41.
36. Brentz, Ekonomika, p. 110.
37. Ekonomika gazovoy promyshlennosti, no. 8 (1977), p. 5.
38. Ibid., p. 4.
39. Ekonomika gazovoy promyshlennosti, no. 7 (1976), p. 9.
40. Vyshka (September 1970), p. 2.
41. JPRS, no. 59271 (13 June 1973), p. 3.
42. Gazovaya promyshlennost', no. 11 (1976), p. 9.
43. Ekonomika_ gazovoy promyshlennosti, no. 1 (1977), p. 13 and no. 7
(1976), p. 13.
44. Margulov, Razvitiye gazovoy promyshlennosti, p. 22.
45. Ibid., p. 21.
46. Ibid., p. 40.
47. Ekonomika gazovoy promyshlennosti, no. 8, (1977), p. 36.
48. Ekonomicheskaya gazeta, no. 6 (1977), p. 2.
49. Margulov, Razvitiye gazovoy promyshlennosti, p. 11.
50. Gazovaya promyshlennost', no. 6 (1975), p. 1, and no. 11 (1976),, p. 8,
and Margulov, Razvitiye gazovoy promyshlennosti, p. 18.
51. Margulov, Razvitiye gazovoy promyshlennosti, p. 18.
52. Ibid., p. 40.
53. Ibid., pp. 15 and 40.
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54. Khaskin, Osnovnyye fondy, p. 45, and Margulov, Razvitiye gazovoy
promyshlennosti, p. 15,
55. Orudzhev, Ekonomika, pp. 70-71.
56. Review of Sino-Soviet Oil (January 1972), p. 9, and Gazovaya pro-
myshlennost', no. 1 (1976), p. 2.
57. Gazovaya promyshlennost', no. 1 (1976), p. 2, and Stroitel'stvo trubo-
provodov, no. 3 (1971), p. 1.
58. Oil and Gas Journal (10 October 1977), p. 110.
59. Izvestia (12 December 1976), p. 2.
60. Pravda (4-5 May 1973) and Gazovaya promyshlennost', no. 6 (1977),
p. 32.
61. The data in this section are taken from Vneshnyaya torgovlya SSSR,
Moscow, various issues.
62. Ibid., for this section.
63. Ibid.
64. Survey of World Broadcasts (SWB), EE/W925/A/11 (14 April 1977).
65. See, for example, SWB, SU/W901/A/12 (22 October 1976) and
EE/W809/A/19 (9 January 1975); Journal of Commerce (16 January
1976), (4 September 1975), and (19 May 1976); Izvestia (10 June
1974); and Vyshka, (3 December 1975).
66. SWB, SU/W879/A/1 (21 May 1976), and The Jamoriat, Kabul (3
December 1975).
67. Vneshnyaya torgovlya SSSR, 1976 (1977), p. 230.
68. Ekonomicheskaya gazeta (6 February 1976), p. 8.
69. Gazovaya promyshlennost', no. 11 (1976), p. 4.
70. See, for example, Gazovaya promyshlennost' no. 6 (1975), pp. 2-5, and
no. 1 (1976), p. 3, and Ekonomika gazovoy promyshlennosti, no. 7
(1976), p. 7.
71. Pipe Line Industry (November 1976), p. 98; JPRS, no. 48652 (20
August 1969), pp. 31-32; and Izvestia (12 December 1976).
72. Stroitel'stvo truboprovodov, no. 10 (1975), pp. 2, 4, and 6.
73. Oil and Gas Journal (10 October 1977), p. 110.
74. Vneshnyaya torgovlya SSR 1975, Moscow (1976).
75. For a general Soviet statement on USSR need for imported pipe, see
Ecotass, European Edition, no. 42 (17 October 1977), pp. 3-4.
76. Gazovaya promyshlennost', no. 6 (1975), p. 3.
77. Ekonomika gazovoy promyshlennosti, no. 8 (1977), p 38.
78. Gas Turbine World (July 1976), p. 18.
79. Ibid. and Gazovaya promyshlennost', no. 8 (1977), p. 8.
80. Journal of Commerce (19 May 1976); Gas Turbine World (July 1976),
p. 21; and European Chemical News (21-27 August 1976), p. 14.
81. Oil and Gas Journal (20 December 1976), p. 23.
82. See, for example, Izvestia (22 September 1974), p. 3.
83. Ecotass, 32/1972 (9 August 1976), pp. 14-15.
84. Ekonomicheskaya gazeta, no. 28 (1977), p. 17.
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85. Oil and Gas Journal (29 November 1976), p. 36; (2 August 1976), pp.
74-75; and (12 July 1976), p. 38.
86. Ekonomicheskaya gazeta, no. 6 (1977), pp. 1-2.
87. Gazovaya promyshlennost', no. 8 (1977), p. 3.
88. Based on Gazovaya promyshlennost', no. 11 (1976), p. 12, and Ekono-
mika gazovoy promyshlennosti, no. 8 (1977), p. 36.
89. Pravda (7 March 1977). The Soviets have recently suggested that
Urengoy might ultimately produce up to 200 billion to 250 billion cu m
per year, but have not specified whether they truly intend to achieve
this. See Ekonomicheskaya gazeta, no. 24 (June 1978), p. 2, for a
discussion of Urengoy.
90. Gazovaya promyshlennost', no. 7 (1977), p. 3.
91. See, for example, Pravda (10 and 24 August 1977); Izvestia (24
February 1978); and Pravda (5 June 1978).
92. Indications that the plenum did launch the drive can be found in
Sotsialisticheskaya industria (31 December 1977) and Literaturnaya
gazeta (11 and 18 January 1978).
93. A suggestion of this can be found in the Pravda editorial of 18
December 1977.
94. Sotsialisticheskaya industria (22 January 1978).
95. Sotsialisticheskaya industria (8 February and 3 March 1978). The
Soviets are also discussing the start-up of construction of the second line
before 1980. See Pravda (15 February 1978), pp. 1-2, for coverage of
the problems facing the first pipeline's construction.
96. Yoprosy ekonomiki, no. 11 (1976), p. 52, and Planovoye khozyaystvo,
no. 12 (December 1976), p. 26.
97. See, for example, Petroleum Economist (April 1977), pp. 133-136.
98. Gazovaya promyshlennost', no. 8 (1975), p. 5; Orudzhev, Gazovaya
promyshlennost', p. 39; and V. N. Kal'chenko, Ekonomika gazovoy
promyshlennosti, Kiev (1974), p. 68.
99. Neftyanaya i gazovaya promyshlennost', no. 4 (1975), p. 2.
100. Ibid., p. 4.
101. Margulov, Razvitiye gazovoy promyshlennosti, p. 31.
102. Pravda (13 December 1976), p. 1.
103. Foreign Broadcast Information Service (FBIS), "Soviet Union" (19
November 1976), p. R-8.
104. Margulov, Razvitiye gazovoy promyshlennosti, pp. 29-30, 32.
105. Ekonomika gazovoy promyshlennosti,' no. 5 (1976), pp. 15-21.
106. Margulov, Razvitiye gazovoy promyshlennosti, pp. 29-30, 32.
107. Ibid., pp. 29-30.
108. Neftyanaya i gazovaya promyshlennost', no. 1 (1977), p. 2.
109. For background on the Turkmen gas industry's development, see
Pravda (4-5 May 1973) and (25 April 1975); Stroitel'stvo truboprovo-
dov, no. 8 (August 1974), pp. 12-13; and Geologiya, bureniye i
razrabotka gazovykh mestorozhdeniy, no. 8 (April 1977), pp. 7-11.
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110. SWB, SU/W905/A/13 (19 November 1976).
111. Brentz, Ekonomika, p. 25.
112. SWB, SU/W922/A/10 (25 November 1977).
113. SWB, SU/ W921 /A/ 14 (18 March 1977).
114. Turkmenskaya iskra (19 February 1977), p. 2.
115. Based on SWB, SU/W9]7/A/7 (18 February 1977); SU/W911/A/7
(7 January 1977); and SU/W912/A/19 (14 January 1977); and JPRS,
no. 68685 (25 February 1977), p. 6.
116. Ekonomika gazovoy promyshlennosti, no. 8 (1977), p. 36.
117. For a recent Western overview of Tyumen' Oblast's gas industry, see
Oil and Gas Journal (22 May 1978), pp. 31-33.
118. Brentz, Ekonomika, p. 28.
119. Orudzhev, Gazovaya promyshlennost', p. 12.
120. Ekonomicheskaya gazeta, no. 24 (June 1978), p. 1.
121. Review of Sino-Soviet Oil (August 1975), p. 13.
122. Gazovaya promyshlennost', no. 2 (1975), p. 11.
123. Orudzhev, Gazovaya promyshlennost', pp. 14-21.
124. Ekonomicheskaya gazeta, no. 24 (June 1978), p. 1.
125. Gazovaya promyshlennost', no. 4 (1977), p. 7.
126. Gazovaya promyshlennost', no. 8 (1977), p. 6, and Geologiya nefti i
gaza, no. 1 (1976), pp. 1-2.
127. For an overview of costs and capital investment in West. Siberian gas
development, see Izvestia sibirskogo otdeleniya akademii nauk SSSR.
Seriya obshchestvennykh nauk, no. 11 (September 1977), pp. 116-119.
128. Ekonomika gazovoy promyshlennosti, no. 2 (1975), p. 12.
129. Gazovaya promyshlennost', no. 3 (1976), p. 14.
130. Ekonomika gazovoy promyshlennosti, no. 2 (1975), p. 12.
131. Khaskin, Osnovnyye fondy, p. 54.
132. Gazovaya promyshlennost', no. 3 (1976), pp. 12-13.
133. Margulov, Razvitiye gazovoy promyshlennosti, p. 21.
134. Ekonomika gazovoy promyshlennosti, no. 1 (1977), p. 6.
135. Ibid., p. 7.
136. Pravda (27 February 1977), p. 3.
137. Gazovaya promyshlennost', no. 3 (1976), p. 14.
138. Ibid., p. 12.
139. Ekonomika gazovoy promyshlennosti, no. 2 (1975), p. 12.
140. Stroitel'stvo truboprovodov, no. 1 (1976), pp. 10-13.
141. Khaskin, Osnovnyye fondy, p. 55.
142. Orudzhev, Gazovaya promyshlennost', p. 41.
143. Sovetskaya rossiya (4 December 1976), p. 2.
144. Ekonomicheskaya gazeta, no. 9 (February 1978), p. 2.
145. Gazovaya promyshlennost', no. 4 (1977), p. 6.
146. Gazovaya promyshlennost', no. 3 (1977), p. 6.
147. Ekonomicheskaya gazeta, no. 9 (February 1978), p. 2.
148. Orudzhev, Gazovaya promyshlennost', p. 21.
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149. Stroitel'stvo truboprovodov, no. 8 (1976), p. 20.
150. Review of Sino-Soviet Oil (May 1975), p. 23.
151. Review of Sino-Soviet Oil (February 1975), p. 17.
152. Review of Sino-Soviet Oil (January 1976), p. 31.
153. Pravda (23 February 1977), p. 22.
154. SWB, SU/W915/A/6 (4 February 1975).
155. Oil and Gas Journal (6 June 1977), p. 71.
156. Ekonomika gazovoy promyshlennosti, no. 8 (1975), p. 26.
157. Turkmenskaya iskra (28 December 1976), p. 2.
158. Gazovaya promyshlennost', no. 5 (1976), p. 33.
159. Gazovaya promyshlennost', no. 4 (1977), p. 5.
160. Ibid.
161. Orudzhev, Gazovaya promyshlennost', pp. 70-71.
162. Mention of this Soviet practice is made in Pipeline and Gas Journal
(November 1976), p 36.
163. Izvestia (28 September 1976), p. 5.
164. Ibid.
165. Gazovaya promyshlennost', no. 7 (1976), p. 13.
166. Pravda Ukrainy (19 November 1976), p. 2.
167. For general details on the project, noted in the following paragraphs, see
Ekonomicheskaya gazeta, no. 39 (1975), p. 24; Pravda (1 November
1975), p. 4; Izvestia (24 February 1976), p. 4; JPRS, no. 68085 (19
October 1976), pp. 12-20; and Ekonomika stroitel'stva, no. 1.1 (Novem-
ber 1977), pp. 33-38.
168. Ekonomicheskaya gazeta, no. 39 (1975), p. 21.
169. See, for example, Oil and Gas Journal (3 February 1975), p. 60.
170. European Chemical News (20-27 August 1976), p. 14.
171. JPRS, no. 68085 (19 October 1976), p. 18.
172. FBIS, "Soviet Union" (7 July 1975), p. D-5..
173. JPRS, no. 68085 (19 October 1975), p. 20.
174. Ibid.; FBIS, "Soviet Union" (19 September 1975), p. D-1; and JPRS,
no. 65453 (13 August 1975), pp. 1-2.
175. For basic data see New York Times (1 December 1975); Literaturnaya
gazeta (17 December 1975), p. 9; Petroleum Intelligence Weekly (22
November 1976), p. 4; and Ekonomicheskaya gazeta (6 February
1976), p. 8.
176. Literaturnaya gazeta (17 December 1975), p. 9.
177. Journal of Commerce (4 June 1976).
178. Oil and Gas Journal (6 December 1976), p. 58.
179. East-West Trade (25 July 1977), p. 3.
180. Ibid.
181. Ibid.
182. East-West Trade News (31 May 1978) p. 2.
183. Reuter (27 March 1977).
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184. At a meeting in Tokyo in May 1978, the three countries did sign an
agreement continuing the initial exploratory phase and tentatively
agreeing to begin the development phase if sufficient reserves are
proved. See Journal of Commerce (30 May 1978), p. 32.
185. East-West Trade (25 July 1977), p. 3.
186. New York Times (30 June 1973), p. 43.
187. Oil and Gas Journal, "Newsletter" (30 May 1977).
188. Financial Times (28 April 1976).
189. Moscow Narodnyy Bank, Press Bulletin (28 April 1976), p. 6.
190. Oil and Gas Journal, "Newsletter" (30 May 1977).
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 Approved For Release 2002/08/07 : CIA-RDP80T00702A000100060007-7
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