Russian state controlled player Gazprom Neft has brought online a 116-kilometre pipeline that links its Novoport field in the Yamal Peninsula to the country’s gas trunk network, operated by parent company Gazprom.

The pipeline is a major milestone for a project into which an estimated 150 billion rubles ($2 billion) of investments has been ploughed over the last three years.

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About 58 kilometres of the pipeline was buried at an average depth of five metres below the bottom of the shallow water Ob Bay in order to minimise environmental impacts and avoid the line being damaged by sea ice.

The pipeline will be ultimately capable of moving up to 20 billion cubic metres of bypass gas per annum from Novoport to the Gazprom-operated Yamburg field in the Yamal-Nenets region, for onward transfer into the Yamburg–Tula trunkline that runs into central Russia.

Gazprom Neft said that it will be able to use 95% of Novoport's bypass gas, cutting its greenhouse gas emissions from upstream operations.

These facilities will enable the company to supply up to 15 Bcm per annum of gas to Yamburg field, leaving spare capacity for shipping future gas output from its four nearby tracts on the Yamal Peninsula that are yet to be tapped.

Until the link was available, the company had to reinject gas at Novoport at the average daily rate of 20 million cubic metres, with some gas also used for local energy generation, Gazprom Neft said earlier.

According to the company, recoverable natural gas reserves of the Novoport deposit are estimated at about 320 billion cubic metres, with their development now being unlocked thanks to this pipeline export route.

Gazprom Neft expects to see higher volume of by-pass gas in its upstream segment as the company gears to increase production to respond to favourable market conditions, with up to 21 Bcm per year anticipated to flow to the surface already in 2023 or 2024 against 17 Bcm today on its fields in Russia.

With the increasing oil and gas production this year, the company expects its output of hydrocarbons to finally achieve its long-term target of 100 million tonnes (684 million barrels) of oil equivalent in 2021, Gazprom Neft said.

The company is now targeting a 10% growth in capital investments to 500 billion rubles ($6.8 billion) in 2022 against this year to continue with its greenfield projects and partnerships in West and East Siberia, it said.