Viktor Zubkov: best international practices to be used in developing regional NGV markets in Russia

A joint delegation headed by Viktor Zubkov, Chairman of the Gazprom Board of Directors, made a working visit to Milan, Italy.

The delegation included Vitaly Markelov, Deputy Chairman of the Company’s Management Committee, top executives from the relevant subdivisions of Gazprom and Gazprom Gazomotornoye Toplivo, heads of the Russian regions where pilot projects for accelerated development of the NGV market are currently underway – Evgeny Savchenko, Governor of the Belgorod Region, and Vasily Golubev, Governor of the Rostov Region – as well as Valery Golubev, Chairman of the Board of the Natural Gas Vehicles Association, and representatives of manufacturers of natural gas-powered machinery and equipment.

Delegation members met with Attilio Fontana, President of the Italian region of Lombardy. It is an industrially developed region with the heaviest road traffic in the country. The meeting participants discussed the region’s successes in expanding its market of eco-friendly fuels for gas-powered vehicles, such as natural gas. It was noted that there are currently about 117,000 NGVs in Lombardy, while the region’s NGV refueling network includes 186 CNG filling stations.

The parties looked into the possibility of carrying out joint projects for the wider use of natural gas as a vehicle fuel and reviewed the prospects for further collaboration in this regard between the cities of Milan, Belgorod, and Rostov-on-Don. Particular attention was paid to the potential for industrial cooperation between Russian and Italian companies in the manufacturing of oil-and-gas machinery.

In the course of the meeting, Valery Golubev and Mariarosa Baroni, President of NGV Italy (the national NGV consortium), signed a Memorandum of Understanding. The document reflects the interest of Russian and Italian enterprises and commercial entities in joining efforts to expand the use of natural gas as a vehicle fuel.

Delegation members learned about the work of Italian manufacturers of natural gas-powered equipment, as well as visited NGV refueling facilities and a service center where motor vehicles are converted to natural gas.

“Today, Gazprom is carrying out pilot projects that aim to accelerate the development of regional NGV markets in two constituent entities of the Russian Federation at once – the Belgorod and Rostov regions. The key to success in this area is a comprehensive approach, which means, among other things, expanding the NGV refueling network, procuring modern motor vehicles, and providing incentives for owners of such vehicles. We are going to draw on the best national and international practices in this area,” said Viktor Zubkov.

Background

The region of Lombardy is implementing a program to advance the use of eco-friendly motor fuels, including natural gas. There are special incentives available to NGV owners in the region.

In November 2018, Gazprom, the Rostov Region, and RUSNANO signed a roadmap to implement a pilot project aimed at accelerating the development of the NGV market. According to the document, by 2022, the region’s natural gas refueling infrastructure will be expanded up to 39 facilities, the number of NGVs will rise to 55,000, and 10 service centers will be created for the purposes of NGV conversion and maintenance.

In February 2019, a roadmap for the implementation of a pilot project aimed at facilitating the accelerated development of the NGV market was signed by Gazprom, RUSNANO, and the Belgorod Region. According to this document, it is planned to expand the region’s natural gas refueling network up to 39 facilities (including through private investment) and increase the amount of service centers for NGV conversion and maintenance up to 34 by 2022.

It is expected that the experience obtained in carrying out these pilot projects will be used in accelerating the development of NGV markets in other regions.