Russia Latest Country to Decide How to Invest in Shale Gas Plays

While the U.S. experiences a shale gas boom, in Russia's Shtokman gas field, one of the world's largest natural gas fields, energy company Statoil weighs their investment options.

The Shtokman project, which is 51%-owned by Russian state gas firm Gazprom, with Statoil and France's Total as minority shareholders, has been delayed on several occasions due to high costs and uncertainty on global energy markets.

Jan Helge Skogen, head of Statoil in Russia said, "We are seeing a challenging gas market in Europe, the main reason being the shale gas revolution in the U.S. This has had a tremendous effect on the gas and LNG industry globally."

"Shtokman was from the beginning required heavy and very large investment. This has become even more challenging over the recent year," he said.

"We are now communicating to the Russian government the need for exemption from mineral extraction tax and from gas export duties. I know that this is to ask a lot, but today we see this as the only way to move this project further," Skogen said.

Once extracted, gas from the gas field will both be piped to European consumers and shipped on tankers to global markets as liquefied natural gas (LNG).