Gazprom Neft Targets Industrial Lithium and Iodine Production by 2028, Registers First Carbon Credit Project

Gazprom Neft, the oil arm of Russian energy giant Gazprom, is advancing plans to launch industrial-scale production of lithium and iodine by 2028, with additional prospects for extracting scandium, gallium, rubidium, and cesium from the associated waters of its oil and gas fields. The initiative represents a strategic diversification into critical minerals production while leveraging existing infrastructure, as Russia seeks to reduce import dependence and establish domestic supply chains for materials essential to electronics, medicine, and energy storage technologies.

Dual-Track Critical Minerals Strategy

According to CEO Alexander Dyukov, Gazprom Neft intends to begin lithium production in the Orenburg region and iodine extraction in the Khanty-Mansiysk Autonomous Okrug by 2028. The company has formalized its iodine ambitions through a cooperation agreement signed with the government of Yugra at the St. Petersburg International Economic Forum, targeting a sector where Russia currently imports approximately 90% of its needs. The agreement outlines plans to invest over 6 million dollars in technology development during 2025-2026, focusing on environmentally friendly extraction methods from hydromineral raw materials.

The lithium component addresses Russia’s strategic goal to produce at least 60,000 metric tons of lithium carbonate annually by 2030, supporting domestic battery and electric vehicle industries. The Orenburg region, where Gazprom Neft operates significant oil and gas assets, has emerged as a focal point for this initiative, with the company updating its resource base assessments and testing extraction technologies specifically adapted to associated petroleum waters.

Innovative Extraction from Associated Waters

Gazprom Neft’s approach leverages the byproduct waters from oil and gas production, which contain concentrated levels of valuable minerals that would otherwise be disposed of or reinjected. This method offers several advantages: it utilizes existing well infrastructure, reduces the environmental footprint compared to traditional mining, and creates additional revenue streams from established operations. The company is adapting its geological exploration and production competencies to these new mineral targets, developing optimal business models that integrate rare earth element recovery into ongoing hydrocarbon operations.

The technology development focuses on selective extraction processes that can efficiently separate lithium, iodine, and rare earth elements from complex brine solutions while maintaining the integrity of primary oil and gas production. Pilot projects are being implemented at fields with confirmed adequate concentrations and sufficient volumes of produced water to support commercial-scale operations.

Carbon Credits and Environmental Integration

Parallel to its minerals expansion, Gazprom Neft has achieved a regulatory milestone by registering its first climate project in Russia’s national carbon units registry. The project involves processing associated petroleum gas (APG) to improve environmental performance in Arctic operations, with the system expected to generate 370,000 carbon units that can be traded on Russia’s emerging carbon market. This initiative captures approximately 17 million cubic meters of petroleum gases annually that would otherwise be flared, transporting them for further processing and utilization.

The carbon credit project reflects Gazprom Neft’s broader sustainability strategy, which has achieved a 99.1% APG utilization rate across its operations. The company has historically been active in carbon markets, becoming the first Russian oil company to sell Emission Reduction Units under the Kyoto Protocol in 2011, and has continued to develop climate-focused initiatives including its “Green Seismic 2.0” technology that has preserved over 4.5 million trees from felling during exploration activities.

Critical Minerals Market Overview

Lithium and iodine represent strategic materials with growing global demand. Lithium is essential for battery production supporting electric vehicles and energy storage systems, while iodine serves critical functions in pharmaceuticals, electronics, and industrial applications. Russia’s push into domestic production addresses supply security concerns and positions the country to potentially export these materials to global markets. The extraction of rare earth elements like scandium, gallium, rubidium, and cesium from associated waters could provide additional high-value products for specialized industrial and technological applications, further enhancing the economic viability of these integrated operations.