OIL giant Gazprom is to shelve its development of the Shtokman natural gas field in the Arctic Sea due to excessive costs.
Total and Statoil, which are the Russian company’s partners in the project, are understood to have agreed with the decision that costs cannot overrun.
Shtokman, which is Gazprom’s flagship project, is one of the world’s largest natural gas fields and contains nearly four trillion cubic metres of gas.
Vsevolod Cherepanov, head of Gazprom’s production department, said yesterday: “All parties have come to the conclusion that the financing is too high to be able to do it for the time being.”
He added: “We are collecting new data. We have extensive gas resources. We shouldn’t take hasty decisions.”
Gazprom has a 51 per cent stake in the gas field, Total has 25 per cent and Statoil owns 24 per cent.
Development plans for Shtokman, located 340 miles offshore in the Russian sector of the Barents Sea, have been complicated by the discovery of shale gas in the US, which was previously seen as a huge export market for Russia.
It is thought that talks are still underway as to the future of the natural gas field.