Global energy shift Elena TeleginaDirector of the Institute of Geopolitics and Energy SecurityCorresponding Member of Russian Academy of SciencesDean, International Energy Business DepartmentDoctor of Economics, ProfessorRussian University of Oil and Gas

The Baltic Forum, 25-26 October 2013

Regional GDP growth, World Bank 2013

* % of change 2013 to 2012

Russia2,3 %

(-1,1%)*

USA2,0 %

-0,2%)*

Japan1,4 %

(-0,6%)*

China7,7 %

(-0,1%)*

EU-0,6%

(-0,1%)*

LatinAmerica3,3 %

(+0,3%)*

(+0,4%)*

(+0,1%)*

(-0,2%)*

(-1,0%)*

(+0,5%)*

World GDP 2013 2,2% (-0,1%)

Gas slows down but still expands its role•Global gas consumption grows at 100 bcm/year•Gas is growing faster than oil at 2,4%/year but continues to fall behind coal•Transportation emerges as a major demand accounting for 10% of gas demand growth driven by China and United States

Medium-term Oil Market Balance

Global shale gas basins, top reserve holders

World Shale Deposits

US Shale Fields

Proven resources- 24 tcm

Shale gas in US gas production, tcf per year

US oil shale production will increase to 1,9 mbd in 2016

US oil shale production

Top 10 countries with technically recoverable shale oil resources

Top 10 countries with technically recoverable shale gas resources

Rank Country Shale oil (bbl)

Rank Country Shale gas ( tcf)

1 Russia 75 1 China 1,115

2 US* 58 (48)* 2 Argentina 802

3 China 32 3 Algeria 707

4 Argentina 27 4 US* 665 (1,161)

5 Libya 26 5 Canada 573

6 Venezuela 13 6 Mexico 545

7 Mexico 13 7 Australia 437

8 Pakistan 9 8 South Africa 390

9 Canada 9 9 Russia 285

10 Indonesia 8 10 Brazil 245

World Total 345 (335) World Total 7 299 (7795)

*EIA estimates used for ranking order. API estimates in parenthesis

US shale oil breakeven prices

Shale gas basins in Europe

Shale gas reserves

Shale gasReserves2012

Production Banned

Allowed

Production possible.but under discussion

US gas prices decreasing

Finmarket.ru

$/th cm $/bl

Gas, IndonesiaGas, USA

Gazprom-EuropeBrent

prices forecast Credit Suisse

Unconventional gas in Russia83 700 tcm of CBM (coal bed methane)

Lena Basin

Irkutsk Basin

South Yakutia

Zaryan Basin

Eastern Donbass

Pechora Basin

KuzbassTungus Basin

Talnyr Basin

PWC 2013

Change in current account balance as % of GDP in alternative oil price scenarios

Production Costs, US$/bl

OIL

Conventional Oil 10-40

Secondary production 20-80

Deep sea 40-65

Arctic shelf 40-100

Heavy oil, oil sands 40-80

Oil shale 50-100

US$/thousand cmGAS

Conventional gas 20-210

Unconventional gas (shale, CBM, tight gas) 100-320

Sulphur gas 110-360

Arctic shelf 140-430

Deep sea 180-390

Costs of oil and gas production

IEA WEO

Projects in advanced stage could transform the US into the №3 LNG exporter

(after Qatar and Australia)

IEA

Thank you!