As a result, Russia sustains losses equal to 362 billion rubles per year, suffers environmental degradation and increases greenhouse gas emissions.
At the end of the last century, development of remote and northern fields started in Siberia, and almost no one was thinking of associated gas. The primary target was oil. If at that time an APG utilization infrastructure were created, pipelines laid, processing facilities constructed, and technologies developed; oil production companies today would happily secure profits from APG utilization. Unfortunately, even now, many are not ready to invest into APG utilization facilities. The payback period is quite significant and can reach 5 to 8 years based on different assessments. Production costs of APG products derived in the process of its utilization depends on many factors, such as remoteness of a field, gas-oil ratio, quantities of various contaminants, liquid hydrocarbons, water, and sulfur compounds contained in gas. A gas utilization method should be selected based on a combination of all these factors with a preliminary feasibility study to be conducted. APG can be processed to produce dry gas with properties similar to those of natural gas and broad fraction of light hydrocarbons (BFLH). BFLH is subject to further fractionation to produce various chemical compounds used in the chemical industry.
APG can be used for the generation of electric power needed to operate equipment directly in the field. APG can also be utilized for oil production by the gas-lift method.
InterAviaGaz has developed a technology to produce condensed aviation fuel of APG. After minimal additional processing, this fuel can be used for helicopters and other aircraft.
Condensed aviation fuel is 2-3 times less expensive than aviation kerosene. It also increases engine service life by 20-30 percent, reduces pollutant emissions and fuel consumption, and increases the flight distance by 5 percent. The project payback period is 4 years and requires an inital investment of 272 million rubles. However, oil producers are not in hurry to use this gas in their helicopters and prefer to flare it.
Different sources provide different quantitative assessments of APG flared in Russia, since no reliable system for metering flared gas is available. According to domestic assessments, about 15-20 bcm of APG is flared annually in Russia. Western countries using satellite data estimate 50 bcm per year. According to the Global Gas Flaring Reduction Partnership (GGFR), which operates under the auspices of the World Bank, at least 150 bcm of gas is flared annually in the world. It increases annual greenhouse emissions approximately by 400 million tons, which is almost equal to the total annual reduction of emissions from projects declared under the Kyoto Treaty.
Yet, there is good news too. Some oil companies have vast positive experiences with APG utilization, such as Surgutneftegaz, Sibur, ТNК-ВР, and TatNeft. In 2007, Surgutneftegaz achieved the highest level of APG utilization in Russia equal to 95 percent. ТNК-ВР and Sibur set up Yugragazpererabotka JV in order to ensure maximum efficient receiving and processing of all