Gazprom Believes Shtokman Is 15% Bigger

Gazprom said Tuesday that its huge Shtokman gas field was even bigger than originally thought, upping the ante for five Western oil firms bidding for a share of the field.

Gazprom deputy CEO Alexander Ryazanov said the firm now believed the remote Barents Sea field in the Arctic contained around 3.7 trillion cubic meters of gas, more than 15 percent above the previous estimate of 3.2 trillion cubic meters.

Gazprom said it might extend the deadline to choose final partners from a list of five bidders -- French oil major Total, Norway's Statoil and Hydro and U.S. firms ConocoPhillips and Chevron.

"If we don't disclose the definite list of Shtokman tender participants by April 15, we will do it by the end of April," Gazprom deputy CEO Alexander Medvedev told reporters.

On Monday, Gazprom called on all the participants to raise their bids before it chose two or three partners who will receive an equity stake of up to 50 percent in the project in return for giving Gazprom stakes in some of their own projects.

Gazprom, which already supplies Europe with one-quarter of its gas needs via major pipelines, plans to pipe Shtokman gas 550 kilometers under the sea to a facility on Russia's northern coast, which will turn it into liquefied natural gas for shipment to the U.S. market.

It has said supplies from Shtokman could cover 10 percent of U.S. LNG demand for more than 50 years.

Ryazanov said the first stage of the project -- including producing gas, building pipelines and the liquefaction plant -- would cost $12 billion to $13 billion. Analysts estimate the total cost of Shtokman at more than $20 billion.

"We want our partners to give Gazprom participation in other assets -- world class assets that allow us to become a global company," Ryazanov said.

Gazprom's projects expertise department head, Igor Meshcherin, told reporters Gazprom was no longer required to ask the government to approve special tax conditions for Shtokman after the state scrapped export duties on LNG earlier this year.

Medvedev also said Gazprom hoped to clinch mid-term deals to swap its pipeline gas in Europe for the LNG of other oil majors earmarked for delivery to the United States and Asia.

Gazprom has so far managed to strike only two spot deals for two LNG cargoes for delivery to the United States.

Medvedev also said Gazprom would sign a deal with Germany's E.On on asset swaps before the end of the month.

E.On wants to get one-quarter of Gazprom's Yuzhno-Russkoye field in Siberia and is reported to have offered in exchange its gas assets in Hungary.