The Economic Implications for Teriberka (Териберка) – Shtokman Project

The small remote fishing village of Teriberka (Териберка) is located 130 km’s from Murmansk and has been chosen as the operating hub for Stockman Development AG (SDAG).  *Read more about the Shtokman project here.*  As the first LNG production is to start in 2017 the following are to be built within the coming years;

Onshore Facilities – Contract awarded to Chicago Bridge & Iron (USA)

  • Product intake facilities
  • Treatment plant for export pipeline gas
  • LNG plant with 7.5 million ton/year capacity
  • LNG Storage Tanks
  • Marine Terminal for condensate and LNG export
  • Ancillary facilities
  • Power station, housing village, support vessels and tugs, heliport, etc.

Job numbers are to be as follows from the SDAG website; (take note that the current population of Teriberka is estimated at 1400)

  • 10,000 to be involved with the construction of the plant
  • 600 to become permanent field staff

Controversy

From an article on Bellona.org, a Norwegian environmental NGO, I gathered an interview that took place with the mayor of Teriberka (Териберка).  As it turns out, Shtokman Development AG (SDAG) had correctly set up public hearings, in an effort to allow citizens to address concerns that they may have had with the proposed giant gas condensate project.  Activist groups, however, do not seem convinced.

Most activist organizations hold the position that the citizens of Teriberka are simply uninformed and uneducated to the point where they are literally being tricked into accepting a project such as this without protest.  This, however, tends to be the main activist position with regards to almost any given controversial issue.

The people of the village do have legitimate concerns.  They want jobs.  The following is an excerpt from an NPR article on Russian Arctic claims;

According to 33-year-old Andrei Udin, life in Teriberka is depressing. He has tried for years to find real work. Udin likes the tough talk from Putin, the promise to fight for Arctic territory. “What’s ours should be ours,” Udin says. But after years of delay, he’s beginning to wonder if that natural gas processing plant is really coming to Teriberka.

“If I don’t have a job, natural gas does nothing for me,” Udin says. “I can’t exactly use the gas for food.” Frustration is growing around this village. People are beginning to say that unless the oil and gas riches will be shared, maybe it’s best to leave nature alone.

Read the rest of the article here.

These are legitimate concerns.  The only jobs that have been guaranteed by SDAG have been those that are to be awarded to 10 Murmansk State Technical University students.  The other proposed 600 permanent field staff may very well come from other regions.  We know this fact due to the proposed housing village that is to be constructed to accomodate these permanent staff member.  The SDAK village is not even going to be constructed within the actual village of Teriberka, making the trickling down of benefits difficult.  It is also very well possible that hardly any of the 10,000 construction jobs will be given to Teriberka residents.

I have also written about some of the environmental concerns that groups have held with the Shtokman project in general.  See ‘NGO concerns over Shtokman‘.

What has SDAG contributed to the community of Teriberka?

Say what you wish about the project.  The truth of the matter is that many positives will come from this.  There is to be, for example, an Arctic Hotel Teriberka built by a company named “Flait Invest” that has been handling most flight, car, and hotel accommodations for the many oil executives that visit the region each year.

Among other things, Shtokman Development AG has organized the following, within the past year;

  • Held “Healthy Days in Teriberka”, where local residents were given the opportunity to have free medical and diagnostic examinations by Murmansk’s doctors in Teriberka
  • Funded an environmental excursion for the children of Teriberka
  • Funded a free Wi-Fi zone for the Murmansk State Technical University
  • Announced plans for the selection of 10 Murmansk State Technical University students to be professionally trained to work with SDAG
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2 Responses to The Economic Implications for Teriberka (Териберка) – Shtokman Project

  1. Pingback: The Shtokman Field (Штокмановское Месторождение) « Arctic Economics

  2. Pingback: Shtokman Development AG Changes Gears … Again – Russia « Arctic Economics

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