Gazprom touts legacy

MOSCOW, July 1 (UPI) -- Russian energy company Gazprom puts flexibility at the center of its strategic objectives, the company's chairman said in an address to shareholders.

With more than 35 billion cubic feet worth of daily natural gas output, and a production potential that overshadows that, Gazprom Chairman Alexei Miller said the company was unrivaled as a transporter and producer.

"The true indicator of Gazprom's performance is the ability to promptly respond to changing demand," he said in an address to shareholders.

Miller said recently there was "no doubt" the company was focusing its efforts on building new transport routes to Europe, a plan that he said was backed by growing regional demand for natural gas.

Gazprom aims to add more infrastructure to its twin Nord Stream natural gas line running through the Baltic Sea to Germany. Despite reservations from European officials wary of Russia's grip on the regional energy sector, Gazprom said it would commission the expansion before the end of the decade.

While fully meeting Russian demand for gas, Miller said his company responded adequately to what he said was increased gas demand from Europe.

Europe gets about a quarter of its natural gas needs met by Russia, though the bulk of that gas runs through Soviet-era pipelines running through Ukraine. Contractual disputes during the previous decade disrupted supplies through Ukraine and geopolitical crises have put recent strains on legacy networks for Russian gas.

Miller said it may be cheaper to send gas through a second string of pipelines planned for the Nord Stream network than through Ukraine. Maros Sefcovic, a European leader on energy issues, said the expansion of Nord Stream would "alter the landscape" of the regional energy sector by blocking new sources and suppliers in Europe.

With a European economy looking to break the Russian grip on the region's energy sector, the Kremlin has shifted focus on building successful trade relations with Asia-Pacific economies.

Gazprom has a 30-year sales agreement with China National Petroleum Corp. that calls for 1.3 trillion cubic feet of natural gas per year through a pipeline dubbed the Power of Siberia. Miller said that, with consumers on either side of the Russian border, his company was in a unique position to respond.

"If necessary, we can build up our production in a short time," he said. "This is one of Gazprom's competitive advantages in the domestic and foreign markets."