PROSPECTS FOR NATURAL GAS-BASED MOTOR FUELS IN RUSSIA

Over the past seven years domestic refined product prices have tripled, inspiring interest in alternative motor fuels. This Decision Brief analyzes the viability of two natural gas-based fuels, liquefied petroleum gas (LPG) and compressed natural gas (CNG), in Russia's transportation sector. In CERA's view,

* Natural gas-based motor road fuels have significant potential but are likely to remain niche fuels.
* LPG is more promising than CNG for motor vehicle use owing to its higher energy content and the relatively higher proliferation of LPG mobile filling points.
* Expansion of demand for alternative fuels will depend largely on expansion of the gas station network.
* Alternative fuel utilization requires legislative support to provide more incentives to construct fueling stations and to convert to natural gas-based road fuels to satisfy federal state objectives.

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CERA Reports Online, a wholly owned subsidiary of IHS Energy, is a leading advisor to international energy companies, governments, financial institutions, and technology providers. CERA delivers critical knowledge and independent analysis on energy markets, geopolitics, industry trends, and strategy. CERA's expertise covers all major energy sectors--oil and refined products, natural gas, and electric power--on a global and regional basis.