May 21 (Bloomberg) -- OAO Gazprom, the world’s biggest gas producer, cut its output forecast at its biggest new natural-gas field in the Arctic Yamal Peninsula by 36 percent this year after demand for the fuel contracted.
Bovanenkovo, which holds enough gas to feed the world for 18 months, will probably produce about 29.5 billion cubic meters a year, rather than the 46.3 billion cubic meters previously planned, Vsevolod Cherepanov, head of Gazprom’s production division, told reporters in Moscow today.
“As consumption has declined, our business development strategy, its production part, has been revised,” Cherepanov said. “That’s why we see such volumes.”
Gazprom, which suffered a drop in demand both in Russia and Europe, started production at Bovanenkovo last year, seeking to compensate for declining volumes at western Siberian fields and ensure stable supplies. The field, the biggest on Yamal with 4.9 trillion cubic meters of reserves, will pump 115 billion cubic meters annually by 2017, Chief Executive Officer Alexey Miller said in October.
Gazprom still expects to increase total gas production this year to 495.7 billion cubic meters from 487 billion cubic meters last year, Cherepanov said. Output may be revised by 5 billion cubic meters in either direction and “time will show” what actual production volumes will be, he said.
The gas producer is capable of producing as much as 600 billion cubic meters a year, Cherepanov said. Daily capacity will reach as high as 1.68 billion cubic meters by the end of the year, Deputy CEO Vitaly Markelov told reporters today.
Gazprom failed to meet European calls for higher shipments during a cold snap in the winter of 2011-2012 and has since invested in increasing production and storage capacity.
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