EIA
Before 2020, Russia’s natural gas processing plant ethane production was approximately 25,000 barrels per day (b/d). If all planned natural gas projects come online, Russia could produce nearly 300,000 b/d of ethane from more than 70 billion cubic feet per day (Bcf/d) of projected natural gas production by 2025. This estimate compares with 2019 U.S. natural gas plant ethane production of 1.8 million b/d out of 92.0 Bcf/d of dry gas production.
Ethane is co-produced with natural gas in Russia, and limited domestic demand for ethane has resulted in natural gas processors leaving the ethane in the pipeline gas stream—a process referred to as ethane rejection. Ethane production in Russia began in 1992 with natural gas processing plants in Orenburg—located in southwest Russia near the border with Kazakhstan—supplying about 25,000 b/d of ethane feedstock to the Kazanorgsintez petrochemical plant in Kazan via a 500-mile ethane pipeline.
Responding to growing natural gas production from the Yamal-Nenets region in Western Siberia, Sibur—Russia’s largest independent midstream operator—recently completed a hydrocarbon gas liquids (HGL) pipeline to its natural gas processing and fractionation center at Tobolsk, located approximately 600 miles south of the natural gas-producing region. Sibur completed construction on its new 1.5 million metric tons per year (mt/y) ethylene cracker in the first quarter of 2020. When fully operational, the plant will consume ethane as 20% of its feedstock, doubling Russia’s ethane market to about 50,000 b/d.
Going forward, three additional petrochemical plants designed to process an estimated 220,000 b/d of ethane feedstock are expected to be completed by 2025:
- Ust-Kut ethylene plant (capacity 650,000 mt/y), developed by the Irkutsk Oil Company, is currently under construction. It will receive its ethane feedstock from an adjacent natural gas processing plant.
- Amur gas processing and petrochemical complex, located in Russia’s far east, is jointly developed by Sibur and Gazprom. The world-scale 4.0 Bcf/d natural gas processing plant will process rich natural gas and deliver ethane to a co-located 1.5 million mt/y ethylene cracker.
- Ust-Luga ethane petrochemical complex and an LNG export facility, to be located near St. Petersburg, is proposed for co-development by Gazprom. The project will include a 13.0 million mt/y (1.7 Bcf/d) LNG liquefaction plant, a 4.5 Bcf/d natural gas processing plant, and a petrochemical complex composed of two 1.5 million mt/y petrochemical crackers and derivatives plants.
Altogether, petrochemical plants that are either in operation, under construction, or planned for completion by 2025 will generate nearly 300,000 b/d of ethane demand—more than 1,000% increase over volumes consumed in 2019. By 2025, Russia’s ethane market size may approach Canada’s, which, at more than 350,000 b/d, is currently the world’s third-largest behind the United States and Saudi Arabia.
