The new trading desk in North America for Gazprom, the largest producer of natural gas in the world, sits halfway up the 56 story Bank of America tower in the heart of the America's energy capital. So far, the office, which started trading contracts last week for the first time, is quiet. That won't last. "Our target for volume growth is pretty strong," says John Hattenberger, president of Gazprom Marketing & Trading USA, an arm of the Russian behemoth that claims 17% of the world’s natural gas reserves. "If we could hit 5% [of the U.S. market] in the next five years, that would be about right. In 10 years, I think we could get to 10%." U.S. demand for natural gas is about 60 billion cubic feet a day.
Gazprom for years has been a dominant player in the natural gas market through the use and control of pipelines. It exports gas to more than 30 countries and meets a quarter of Europe’s needs. The U.S. market, however, the largest in the world, has been too far away for Gazprom to reach. Pricey new liquefied natural gas developments, which allow for worldwide shipping, should change all that. Global LNG demand is expected to double by 2020. "LNG is a strategic way for Gazprom to get into markets that it can’t access by pipeline," says Hattenberger. "It makes a lot of sense for the world’s largest gas company to bring gas to the world’s largest gas market and it has to be done through LNG".....Read the entire article.
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