Substantiative data on the Russian Energy Strategy 2030: expert views on the potential export of energy resources Vladimir Feygin, Vitaly Protasov Institute for Energy and Finance Brussels, February 18, 2011

General issues  Figures reflect views of the timing when the ES-2030 was under preparation – it needs and assumes a regular update  Not a result of fully integrated model implementation  Following figures were used in modelling of the ES-2030  Calculations are based on:  Our knowledge on energy markets of potential buyers of Russian energy resources  Expert consensus on the future pathways on energy developments in various regions  Our knowledge about the scenario field  Data on long-term supply contracts (mostly for gas) and export-import infrastructure projects  An analysis of competitors’ potential  Macroeconomic, demographic and pricing assumptions 2

Oil prices analysis 3

Oil and oil products  EU – import dependency growth, stable major buyer for Russian oil and oil products (on oil products less predictable)  USA – yet not sufficient role but may increase as infrastructure matures  Asia Pacific – high potential especially for China. Deliveries from Eastern Siberia fields. New pipeline connections. 4

Gas prices analysis 5

World gas forecasts analysis (at that moment) 6

Natural gas (1)  Europe – the most important market  Role of the Russian gas in the European consumption: stable or growing (scenario analysis)  Deep external forecasts analysis, incl. PRIMES  Latest crisis has a negative impact (at least on 2010) 7 Bcm Note: 8000 kcal/cub m Russian expert views on possible gas export from Russia to EU-27

Natural gas (2)  USA – now seems as market of limited perspective because of “shale gas revolution”  Asia Pacific – high potential (up to bcm of the Russian export in 2030)  Significant dependence on such projects as pipelines to China (and probably South Korea)  Plus LNG supplies from various sources  CIS – dependence on usage of Central Asian gas  Expectations based on existing contracts data and moderate consumption growth  Supply of bcm in 2020, bcm in 2030 of only Russian gas (without Central Asian) 8

Coal  Europe – a traditional market, especially Germany and UK. Its consumption decrease due to environmental reasons  CIS – Ukrainian market (production decrease in the Donbass region)  Asia – stable demand on Russia gas from Japan, South Korea, Taiwan, import growth to China and India  Up to mln. t/y in

Electricity  Transportation limitations cause need for look on concrete countries and even its regions  Finland – key market, decrease of the Russian export in the long-term.  Export 9 bln kWh in the mid-term, 5-6 bln kWh in the long-term  CIS – Belorussia, Ukraine and Kazakhstan  Baltic countries –possible substantial increase due to Ignalina decommissioning  North-East China and South Korea growing needs for electricity  Export to China 7-10 bln kWh in mid-term, in the long- term 10