VLADIVOSTOK – Located in the freezing Far East of Russia, Vladivostok has long relied on coal-fired power to heat the city during its long winters. A major new gas pipeline promised as a benefit to host the recent Asia-Pacific Economic Cooperation (APEC) summit was seen as a chance for the city to finally have a greener, cleaner form of energy.
“Our biggest coal plant is in the city, so many residents have complained that they have to wipe a new layer of soot from their window sills every day,” says Elvira Tirina of the city’s press office. “People had been waiting for the switch to gas for a long time and they were happy to see the rapid pace of construction.
Now it seems the locals got excited for nothing. It turns out that this “gift”, according to experts, is likely to be a major headache. It’s no more reliable than the other things being built in record time as the APEC summit approaches – like roads and already crumbling buildings. More than 1,800 kilometers of pipeline have been laid in less than three years, across central Russia, near the Chinese border.
Billions for a “Soviet car”
Problems with the pipeline, which ended up costing almost half a trillion rubles (about $20 billion) – making it the most expensive pipeline in the world – began in December 2011, just after the start of the project.
According to Gazprom Transgas Tomsk and Gazprom Interregional Novosibirsk, the two companies in charge of the project, the pipeline regularly experiences hydraulic blockages – in other words, water gets stuck in the pipes and freezes in cold weather, blocking the flow of gas. . Transgas Tomsk says that’s not unusual for a pipeline.
In January 2012, during the usual water evacuation procedures, there was already an incident when the gas caught fire and the fuel could not be delivered to Vladivostok for four days. This prompted the government to demand an urgent assessment of the pipeline. The special commission in charge of this evaluation transmitted its conclusions to a special prosecutor.
At that time, the two companies responsible for the pipeline insisted that the cold weather was the sole culprit. This made the latest news even more disturbing: in mid-November, the Novosibirsk interregional imposed a reduction in gas consumption for its customers in Vladivostok due to the freezing of parts of the pipe. Russky Island, off Vladivostok, where the APEC summit was held, was left without gas. Considering that last November temperatures in the region were actually warmer than usual, this supposed “freeze” has caused quiet panic among consumers.
“Since 2011, we have encountered gas supply problems 15 times from Vladivostok power plants; the supply was completely cut off five times,” explained Sergei Tolstogrusov, general director of the Vostok power plant. “In winter, these problems can lead to emergency situations: coal-fired boilers heat only about a quarter of Vladivostok’s homes. Due to the issues we have encountered, we are considering delaying the transition to gas for these plants. In the event of an emergency, local power stations have reserves of fuel – fuel oil. But in winter, these reserves last no more than 10 days. After that, the city needs new deliveries. The city of Vladivostok commissioned a special study to find possible solutions in case of “surprises” from the gas line. The study revealed that in the event of a problem, additional fuel oil would not be delivered on time – and Vladivostok would have no heating. The average January temperature in Vladivostok is 10 degrees Fahrenheit.
On top of that, reserve fuel oil is expensive – according to the Vostok Power Plant, unreliable gas deliveries have already cost the company 500 million rubles (about $16 million). The power company has already sued the pipeline operators for these losses. Pipeline operators, however, don’t seem to have sweated.
“When you buy a Soviet car, you have a break-in period,” explained Transgas Tomsk. “For the first 100 kilometres, everything has to be settled. That’s what happens with the pipeline – the first year or two is the break-in.
Pipeline to nowhere
“There are actually two versions of gas delivery problems,” says Igor Yushok, the National Energy Security Fund’s top expert. “First of all, there are flaws due to rushed construction. The pipelines were built in record time: the first excavations took place in 2009, and by 2011 gas was flowing to Vladivostok. Second, there is pipe undercapacity. The project was supposed to transport 6 billion cubic meters per year, but only 1.5 billion cubic meters are actually transported. It basically means that the pipeline wasn’t built the way people thought it would be.
The speed of construction is truly impressive, especially considering that the other pipeline built by Transgas Tomsk took eight years to build. That, and the fact that the other pipeline was only 320 kilometers long, while the Vladivostok pipeline is 1,800 kilometers long.
The pipeline will not be submerged this winter. Vladivostok is expected to consume only about 1 billion cubic meters of gas in the whole of 2013, and potential foreign customers for the pipeline have not come forward, although they were discussed at the APEC summit . Gazprom had also talked about building a gas liquefaction plant near Vladivostok by 2017, but at this stage the pipeline, if it only serves people in the region, is a financial loss for its builders.
“Gas supply, of course, is more environmentally friendly and opens the door to modern technology,” says Fedor Glushkov, chairman of the Far East Business Consortium. “But companies often think exclusively about money. In the short term, conversion to gas increases costs.
Russia’s attempt to improve its image by showing off its use of natural gas at the APEC summit has already turned into a multi-million dollar loss and threatens to leave Vladivostok residents without heating in the winter. Of course, some residents of Primorsky Krai, as the Vladivostok region is called, are not worried: for example, residents of the Frunsensky region, which includes Russky Island, where the APEC summit was held .
Anyway, they were never supplied with gas. As the regional government explained, the only place in the whole region that was supplied with gas was the campus of the Far Eastern Federal University, where the APEC summit was held, and where the people need special permission to enter. Interregional Novosibirsk confirmed: “We do not intend to supply gas to residents of Russky Island in 2012.”