Gazprom is ready for new challenges
June 28, 2022
Published in Gazprom Magazine Issue 4, written by Oleg Aksyutin, Deputy Chairman of the Management Committee – Head of Department, Gazprom
The research & design complex of the Gazprom Group encompasses a wide range of tasks, serving to provide the base for planning and design activities, as well as research support during the entire lifecycle of investment projects. The research & design activities are currently consolidated in the leading institutes – Gazprom VNIIGAZ, Gazprom Proyektirovaniye and NIIgazeconomika. The creation and development of these responsibility centers was part of an integrated approach to and systemic efforts for the strengthening and buildup of production capabilities. This allowed the Group to effectively address new challenges, enhance manageability of assets and strengthen the responsibility for their operational results, as well as to reinforce cooperation within the industry with a view to achieving a higher efficiency in the implementation of investment projects.
The history of the creation and development of the Gazprom Group's research & design complex begun in the early 1930s, because it was then when pertinent issues of the gas industry were determined and the relevant research and design subdivisions to effectively address them were established. The subdivisions subsequently evolved from separate research teams and laboratories to the first self-reliant comprehensive research organization, the All-Union Scientific Research Institute of Natural Gases (VNIIGAZ). The institute was established on June 2, 1948, under the Central Scientific & Research Laboratory of the Soyuzgazrazvedka Trust and Laboratory No. 5 of the All-Union Scientific Research Institute of Synthetic Liquid Fuels and Gas (VNIGI).
During the initial stage of its development, the institute solved the practical tasks of ensuring the reliable operation of the first gas trunkline, which was Saratov – Moscow, and expanding the raw material base. Later on, its activities were closely linked to the development of new fields and new technologies, as well as implementation of programs for the comprehensive development of the gas industry. As the gas sector expanded, the scale of scientific & research tasks grew with it, and to address those tasks, full-fledged independent research organizations were established on the basis of certain subdivisions of VNIIGAZ.
For instance, in 1962, the history began for the future SevKavNIPIgaz institute specializing mainly in the development of the oil & gas complex in the Stavropol and Krasnodar Territories. In 1966, the foundations were laid for the future TyumenNIIgiprogaz institute which specialized in hydrocarbon development projects in Western Siberia. The year 1967 marked the creation of VNIIEgazprom (later NIIgazeconomika), the institute which focused on issues related to determining the most important lines of activities in the organization of management and assessment of the gas sector economy, as well as drawing up the general scheme for the gas industry development.
The research & design complex of the gas sector made an invaluable contribution to the shaping of the domestic gas industry in the 20th century by creating comprehensive synchronized development programs. The programs laid the groundwork for the development of major gas fields in permafrost areas (development through cluster systems of large-diameter wells; three-string well design; heat insulation of flowlines, etc.), as well as for commercial production, collection and processing of sulfurous gas, along with the creation of high-capacity automated comprehensive gas treatment units and gas transmission systems with a diameter of 1,420 mm designed to withstand the working pressure of 7.4 MPa (75 atm).
During the market transformations of the 1990s, the research & design complex of the sector changed quite substantially, but the Gazprom Group managed not only to maintain, but also to quite actively develop it. It was largely through the use of the scientific potential of the oil & gas complex that the Group successfully solved the tasks of the “transition period” and was able to commence new promising projects.
Reformations
As the domestic gas industry evolved, over 15 separate scientific & research and design entities were established to solve specific regional, technological and other tasks. However, those organizations became very disconnected from each other by the early 2000s as a result of changes that occurred in the economic climate and structure of the gas sector. Moreover, they became engaged in a very intense intra-group competition. Under certain circumstances, competition can be not an incentive for development but exactly the opposite. That is why, to offset the so-called flaws of the market, Gazprom made a decision to reform its research & design complex. In order to effectively implement its new large-scale projects, the Group had to mobilize all of its potential and, accordingly, to overcome excessive and unfair competition and strengthen accountability for the final result.
The targeted efforts for structuring the heterogeneous sci-tech and design activities led to the consolidation of design development assets and scientific (technological research) assets under Gazprom Proyektirovaniye and Gazprom VNIIGAZ, respectively.
Gazprom Proyektirovaniye was established in 2015 on the basis of the Group's design entities that had been directly involved in the creation and development of the domestic oil & gas sector for as long as since the 1930s and accumulated exclusive knowledge and invaluable experience. The key tasks during the reformation of the design complex were to reduce the time and increase the quality of design documentation development, provide for a single technical policy and standards of design development, enhance the economic efficiency of investment projects, upgrade production facilities and implement modern automated design systems with the use of innovative approaches. Today, Gazprom Proyektirovaniye consists of five large branches which are located in St. Petersburg, Saratov, Nizhny Novgorod, Tyumen, and Moscow, and have a total headcount of over 5,200 employees. The company's internal procedures are harmonized, inter alia, owing to the implementation of modern digital tools. The combination of the legacy of Soviet design traditions and international experience is bound to make Gazprom Proyektirovaniye the leader of the design development field even beyond the gas industry.
In 2018‒2022, as a result of the reformations in the Group's sci-tech activities, Gazprom VNIIGAZ evolved into a research & production system which can deliver a full cycle of services, from generating new ideas to translating them into steel or digits. The institute is also the entity that consolidates the responsibility for the design development and scientific support of innovations and, inter alia, performs author supervision over the operation of all fields of Gazprom. Today, the institute employs over 2,200 specialists focused on various areas of the gas business value chain. Apart from its home site located in the Razvilka settlement of the Moscow Region, the institute is represented by subdivisions in Tyumen, Ukhta, Kazan, Makhachkala, Lensk, Stavropol, and St. Petersburg. Activities are now underway for Gazprom VNIIGAZ to consolidate the scientific potential of SevKavNIPIgaz and VolgoUralNIPIgaz (Orenburg), as well as to create a new subdivision of the institute in Omsk. It is planned to develop the presence of the institute in other regions of Gazprom's operations as well. The scientists of VNIIGAZ state: “Our science is an applied one and must therefore be closer to production activities.”
The years 2018‒2022 were also the time when research centers for organizing the management and development of cutting-edge software systems in all dimensions of the gas sector's expansion started to emerge under NIIgazeconomika. Their activities now include the creation of digital twins of production, transmission and processing facilities. Also underway is the implementation of artificial intelligence methods in the modeling of the gas industry business processes in order to make scientifically valid managerial decisions.
Therefore, as a result of the transformations implemented, the research & design complex of the Gazprom Group is represented by three main organizations today. Gazprom VNIIGAZ is the responsibility center as regards gas technologies, the research & methodological center for standardization, and the operator of the Single Window System for implementing innovations. Gazprom Proyektirovaniye is the responsibility center as regards the design development of production facilities. NIIgazeconomika is the responsibility center as regards research & methodological support in economics and organization of management in the gas sector. The total headcount of these entities is almost 8,000 employees.
Recent changes in the research & design complex of the Group are in line with the unified approach and systemic efforts being implemented by Gazprom to unite potential and responsibility. Similar reforms were carried out in other lines of business as well, resulting in the creation of such companies as, for example, Gazprom Invest, Gazprom Nedra and Gazprom Diagnostika. Their cooperation with the research & design subsidiaries is now not only active, but also effective to the maximum extent possible. This approach has made it possible to optimize the number of management units and, accordingly, to considerably enhance administration practices and increase responsibility for results within the entire lifecycle of projects, as well as to establish cross-functional interfaces which are required to implement large-scale investment projects.
Renewed System
Initially, all of the institutes were established with both research and design units incorporated into them, with the relative significance and size of the units depending on the specific features and tasks peculiar to the given institute. This blend of competencies was valid and even necessary at that period of gas industry development. However, transition to a new form of economy management, development of a competitive market and implementation of modern methods of investment project management were the very reasons that called for reforming the research & design complex.
For instance, the main activity and responsibility of VNIIGAZ is the FEED phase, which is the stage for developing new technical solutions or fine-tuning the existing ones, as well as for preparing the concept study of projects. Standards are established and innovative proposals are generated during this phase as well. The function of NIIgazeconomika at this stage is to assess the feasibility of projects and subsequently issue recommendations regarding the decisions to be made on whether it is economically feasible to implement an investment project. The next stage of project implementation is design development. At this stage, Gazprom Proyektirovaniye has to ensure due timeframes, quality and implementation with regard to the provisions of a corresponding concept. The competencies of Gazprom Proyektirovaniye include performance of pre-investment studies, collection of initial data, design & survey works, development of design and working documentation, as well as observance of the state expert review procedure and provision of author supervision services. There are all types of facilities in the company's design order portfolio: pre-development of fields, hydrocarbon storage, distribution and processing facilities, gas distribution facilities and major repairs of facilities.
After the design development stage, it is the turn for Gazprom Invest, as the single customer of projects, and Gazstroyprom, as the single contractor, to take over the project. They perform their work on a high-quality level and then transfer the ready-to-operate facility to a relevant subsidiary of Gazprom. It has to be noted that Gazprom VNIIGAZ, NIIgazeconomika and Gazprom Proyektirovaniye provide support services within the entire lifetime of projects, actively and effectively interfacing as the required cooperative relations are now perfectly streamlined.
To see how much more efficient the renewed system has become, we can take Gazprom Proyektirovaniye as an example. The company now comprises Gazprom Promgaz (Moscow), TsKBN (Podolsk in Moscow Region), Giprospetsgaz (St. Petersburg), VNIPIgazdobycha (Saratov), and the Stavropol subdivision of SevKavNIPIgaz which performs design development works. The efficiency of design development increased when these organizations were consolidated under Gazprom Proyektirovaniye, because there is no more overlapping of similar activities at different organizations. The Group's asset structure was optimized, and the planning of design & survey works and management of resources were centralized so that they could be exercised at a single management center. Besides, a unified technical policy is being implemented and unified standards of design development activities are being adopted. Each organization working under Gazprom Proyektirovaniye is assigned with its own niche, which rules out the possibility of overlapping and puts a focus on particular works and services. For instance, the Gazprom Promgaz institute is given the function of a sector-specific expert review center dealing with overhaul projects, gas infrastructure expansion and cost estimate documentation.
Mission
The mission of Gazprom's research complex is to provide high-quality and timely solutions for sci-tech issues that arise during the achievement of established production objectives and target indicators.
For instance, the strategic priorities of VNIIGAZ are meant to match the need for solutions and technologies that can meet any challenges faced by both the parent company and the Russian gas industry in general. Among such challenges are the considerably increasing complexity of the mineral resource base, dynamic development of the gas transmission system and gas storage facilities, changes in the directions and methods of energy supplies, rapid development of end-to-end digital technologies and, of course, decarbonization, i.e. the so-called climate neutrality.
The strategic priorities of NIIgazeconomika reflect the new challenges of the present and include, first and foremost, introduction of updates into strategic industry-specific documents and creation of import-substituting software and tools for maintaining unified knowledge databases in all lines of business carried out by the Gazprom Group.
Today, there is an entire range of promising areas of innovative development. These include the following technological innovations: development of methods for enhanced oil and gas recovery; elaboration of technical solutions for follow-up development of low-pressure Cenomanian gas deposits and development of deep-lying hydrocarbon deposits; development of hydromineral raw materials for the production of lithium compounds and iodine. Creation of digital models of fields and underground gas storages and development of innovative gas transportation technologies. Development of processing technologies for feedstock with complex composition accompanied by the increased variety of derived products delivered; advancement of NGV and hydrocarbon technologies and promotion of the liquefied natural gas (LNG) business. These challenges are to be addressed mainly with the use of world-class domestic technologies.
The key development goals of Gazprom Proyektirovaniye are to reduce the time and increase the quality of design documentation development, provide a unified technical policy and uniform standards for design development activities, and enhance the economic efficiency of investment projects.
Directions for development
All major projects being currently implemented by Gazprom are characterized by a high degree of research intensity. In this regard, three main directions for prospective development can be singled out: eastern Russia, Yamal and the continental shelf. These regions have complex natural and climatic conditions and lack infrastructure, while being a source of feedstock with complex composition. In combination, these peculiarities require the use of the most advanced modern technologies in order to reduce capital and operational costs and increase the reliability and safety of operations at facilities.
A unique example of development and introduction of cutting-edge technologies at Gazprom's facilities is the application of the membrane helium extraction technology at the Chayandinskoye oil, gas and condensate field (OGCF). During the development of fields in Eastern Siberia and the Far East, it was discovered that the helium content in the produced gases is above the global demand. However, if we do not extract the excessive helium from gas, it will be lost forever. This is why a need arose to create a relatively simple technology with low energy consumption to be used for extracting helium that is not sought after in the market and keeping it in long-term storages. The membrane unit for helium concentrate extraction makes it possible to regulate the helium content in the extracted multi-component gas directly at the production site prior to feeding the gas into the gas pipeline. This reduces the helium content in the gas down to the amount to be subsequently extracted at the processing facilities and delivered to consumers. Storages were arranged in isolated areas of the Chayandinskoye OGCF. The unit was put into commercial operation in December 2021. Since that time, as much as about 30 million cubic meters of helium contained in helium concentrate were extracted and placed in the formation for storage. We are creating a strategic reserve of the gas which is the future of the energy sector. The technology is unique. This is a unit with no foreign equivalents. The innovation won the top award of Gazprom's Science and Technology Prize 2021.
Severnoye Siyaniye (Northern Lights) semi-submersible drilling rig, Yuzhno-Kirinskoye field
Another production facility that uses new technologies is the Kruzenshternskoye gas and condensate field (GCF). To develop the offshore part of the Kruzenshternskoye GCF, artificial islands are to be created in the Sharapov Shar Bay of the Kara Sea. The area has predominantly shallow depths (not more than 3 meters) and an average ice-free period of about 70 days per year. The bottom of the bay has highly unstable and fluid clay soils. The artificial islands will be about 4 kilometers away from the coastline. Therefore, the design development for and construction of the islands will become the first invaluable experience for both Gazprom Proyektirovaniye and the Gazprom Group at large.
The Kruzenshternskoye GCF development project became the site for elaborating the technology for in-field gas treatment in the Extreme North and permafrost soils. The technology envisages the use of seawater as a cooling agent, and refrigeration units are used to generate cold for the low-temperature process. It can also be applied at other fields of the Yamal Peninsula.
Modernized air cooling units (ACUs) for gas are currently being tested at the Salskaya compressor station (CS) in the Rostov Region. The use of the ACUs will considerably reduce the number of units installed at CSs and therefore reduce capital expenditures and operational costs.
New construction methods, such as Direct Pipe, are implemented during the construction of linear parts of pipelines in submerged crossings. The Direct Pipe method, which considerably reduces the construction period and costs, is planned to be used to lay the crossings of the Ukhta – Torzhok 3 (Yamal) gas trunkline under the Vym, Malaya Severnaya Dvina, Limenda, and Sukhona Rivers.
LNG production, storage and shipment complex near Portovaya compressor station
Other important activities as regards the implementation of new technologies include the development of the Yuzhno-Kirinskoye OGCF, expansion of the Sakhalin – Khabarovsk – Vladivostok gas trunkline, use of the Power of Siberia gas transmission system (GTS), as well as the expansion of the GTS to bring gas from the Bovanenkovskoye OGCF via the northern corridor into Russia's northwestern and central regions.
The scientists at Gazprom also see potential in the development of unconventional gas resources (Senonian deposits, gas hydrates, CBM deposits, etc.), effective reextraction of remaining reserves, development of brownfields, as well as achievement of higher efficiency as regards the development of hard-to-recover gas reserves with low permeability and porosity, including through increasing the efficiency of hydraulic fracturing.
As regards processing and environmental protection, the top-priority development areas of the gas sector are efficient production, transmission, storage and sales of a wide range of natural gases, for instance, hydrogen, carbon dioxide and helium; monetization of associated components such as lithium, iodine and sulfur; and adaptation of the Gazprom Group to climate change, i.e. development of the required nature-like technologies which offset negative environmental impacts.
Results and Plans
In 2021, the enterprises of the research & design complex demonstrated confident growth and successfully completed the reporting year, performing more work for the Gazprom Group than in the previous year. For instance, the amount of work delivered by VNIIGAZ increased by 50 per cent and NIIgazeconomika performed 40 per cent more work versus 2020. Both enterprises have stable financial and economic standing. They plan to keep providing scientific support to the Gazprom Group throughout 2022, including in the matters of geology; field development; gas and condensate production, transmission and processing; hydrocarbon development on the continental shelf; energy efficiency; ecology; development of unconventional gas resources; industrial safety; and emergency prevention and response. The objectives set by Gazprom are to perform programs of R&D works, pre-investment studies and design & survey works.
For the Gazprom Group's design development block (Gazprom Proyektirovaniye), the main objective remains the same, i.e. the provision of high-quality design & cost estimate documentation for the facilities that are included in the investment program. The challenge we faced and successfully met in the past few years was to satisfy the increased need for design development. The Company deemed it strategically correct to intensify the work of branches and to use its own resources as much as possible to perform the works. In parallel, efforts were underway to enhance the procedures and tools that underlie the relevant activities. Three main areas can roughly be singled out: planning, 3D modeling and monitoring. The strategy of introducing changes into the planning system was based on transitioning from step-by-step planning to target-based planning with the responsibility for the result of work attributed individually to those who performed it. This became possible thanks to systematic efforts to draw up and approve work plans and record the obligations agreed between those who perform the works and project managers in the period of 2–3 months. In this regard, early detection of project risks and elaboration and implementation of measures to identify and eliminate them became an important part of the process. The Saratov branch was selected to be the pilot one. In 2022, our plans are to adopt the best practices in the other branches of Gazprom Proyektirovaniye as well.
At the same time, each year of the company's history presented new challenges and became a turning point to a certain extent. The challenges of the initial stage were mainly to integrate the original entities, align the approaches to product identification and unify decision-making procedures, while the year 2021 put the company to the test in terms of scopes of works to be completed. This year, the main objective is to systematize the processes of interaction with subcontractors and to integrate them into the ecosystem of Gazprom Proyektirovaniye. Apart from introducing organizational changes and putting a separate focus on certain specialists, both Gazprom Proyektirovaniye and its branches are working to change the approaches to the selection of subcontractors through the use of the dynamic rating system. This corresponds to the general trend of Gazprom's investment block – to work in a systemic way and make data-based decisions – which has already translated into the creation of a project management center in Gazprom Invest. The Design Development Control Center, which is planned to be launched in 2022, will form an important part of this system.
As regards information modeling, 2021 saw Gazprom Proyektirovaniye draw up fundamental methodology documents for working with 3D design development tools. A remote employee training system was developed and put into practice. The distributed 3D design technology, which envisages that three branches work on the same project in a single information environment at the same time, was successfully applied. The pilot project was completed for the development of an information model in compliance with new federal regulatory requirements to information modeling. Integration between the 3D design systems in use was set up.
In 2022, Gazprom Proyektirovaniye has already completed a number of tasks. For instance, the digital information model of the Pikalyovskaya CS was updated on the basis of surface laser scanning which was performed by the company's own forces. An information model to be used at the stage of pre-investment feasibility study was created for the first time at Gazprom. Further plans for the current year are to commence 12 pilot projects which will be performed using the direct 3D design technology; implement four projects with the use of 4D technology where the design is linked to the schedule of construction and equipment supplies; and commence a renovation project for a gas processing plant with the use of surface laser scanning and 3D design technologies.
As for Gazprom VNIIGAZ, the institute has been demonstrating positive financial results for the last three years in a row: the profit totaled RUB 144.5 million in 2019, RUB 130.3 million in 2020, and 481.4 million in 2021. Its revenue for this year is expected to considerably exceed the figures of 2021 and amount to over RUB 10 billion, although 2022 will be the first year for the Gazprom Group's sci-tech capacities to be completely consolidated as is planned by the institute. As a result of the consolidation, Gazprom VNIIGAZ will provide sci-tech support for 100 per cent of the parent company's production activities. In the area of gas transportation and storage, it is planned to make a major step forward in addressing the main research & methodological matters related to the creation of a new-generation gas transmission system designed for the pressure of 14.7 MPa and optimization of the operation system for underground gas storage facilities. Preparations are nearing completion for the pilot operation of an LNG production unit that uses the technology developed by VNIIGAZ and opens the possibility for Gazprom to implement its LNG projects based on its own developments. In addition, promising research in the sphere of low-carbon energy will continue in 2022 with a view to, inter alia, developing hydrogen technologies.
As for the NIIgazeconomika institute, this research subdivision of Gazprom is steadily developing and has been demonstrating positive financial results for more than 12 years. The plans of NIIgazeconomika for 2022 are not only to address its main objectives associated with the services for strategic program documents, but also to expand the use of digital tools in managerial decision-making in line with the Strategy of digital transformation of the Gazprom Group. The institute maintains highly productive cooperation with higher education institutions, such as the Gubkin Russian State University of Oil and Gas, Lomonosov Moscow State University, the State University of Management, and a number of institutes working under the Russian Academy of Sciences, such as Melentiev Energy Systems Institute, Energy Research Institute, and others. Cooperation with these institutions makes it possible for NIIgazeconomika to considerably expand its options for the development of promising research tasks and implementation of their results. By the way, NIIgazeconomika has become the patron of the journal in the sphere of oil & gas industry informatization which is published by the Gubkin University.
In summary, I would like to note that the structural and organizational changes implemented in the research & design complex have already proven their worth. I can say that the entities are ready to address new challenges and reach ambitious goals.
Photos by Gazprom, Gazprom Invest, Gazprom Dobycha Noyabrsk, Gazprom VNIIGAZ, Gazstroyprom