Gazprom

With its interests in the Shtokman gas field in the Barents Sea, the Yamal gas fields, and the Nord Stream pipeline to bring Shtokman gas to Europe, the Russian gas company Gazprom is going to be an important Arctic firm.  Gazprom, the former Soviet gas ministry, is now - by far - the largest gas producer in the world.  It's integrated from exploration, through development, production, and distribution.

Nadejada Makarova Victor profiles Gazprom (Gazprom: Gas Giant Under Strain) in a January report from the Stanford Program on Energy and Sustainable Development's series on national energy companies.

Gazprom is big, but it faces a lot of challenges: 

• It can sell gas profitably in Europe at world prices, but is forced to sell below market clearing prices in Russia for political reasons.  Because domestic prices are so low, and use isn't even metered for more than 90% of domestic residential and industrial consumers, the Russian economy uses way too much gas, and uses it extremely inefficiently. Gazprom loses money in its domestic market.
• Production from Gazprom's giant Siberian gas fields is declining, and is not being offset as new, smaller, domestic fields, or by imports from Turkmenistan.  Production from the Shotkman and Yamal fields in the Arctic is a ways off, and is likely to require considerable capital and foreign skills and technology.  Gazprom has enormous reserves, but 60% of known reserves are not being produced.
• For these reasons, there's some doubt about Gazprom's ability to meet its contractual obligations for exports.
• Pipeline capacity is inadequate.  "...the gas pipeline system is indeed deteriorating.  over 70% of the high-pressure gas pipelines were commissioned before 1985.  The average age of the Gazprom trunk pipelines is not about 22 years, and an estimated 14% of the pipelines are beyond their anticipated lifetime... "
• Gazprom has weak corporate governance, and its economic performance is among the worst of state controlled hydrocarbon enterprises.

Gazprom is a political as much as a commercial company and is tasked with contributing to the Kremlin's political agenda; low gas prices are politically important, investment is politically as much as economically directed, it's assisting the Kremlin "to wrest back control of the energy assets lost in the rigged privatizatins of the 1990s," and it is required to contribute to the Kremlin's foreign policy objectives.

So many of Gazprom's problems come back to lack of investment: necessary investment in exploration, development, and new production and distribution infrastructure.

But, because Gazprom is at the service of the Russian state:

...the current gas shortage in Russia is not the result of limited reserves, but rather of Gazprom's investment strategy.  Instead of investing in new oil and gas fields, Gazprom has pursued unrelated assets at home and abroad.  It seems that many of Gazprom's investments were undertaken to serve the Kremlin's internal and foreign agendas, or to increase its capitalization....

Huge investments are needed to replace Russia's dwindling supply of natural gas, and all the options for new production will prove costly and difficult.  New fields in the far north and east of the country are distant from most of the Russian people and from export markets, requiring wholly new transport systems such as pipelines.  Moreover, most of these new fields are located in extremely harsh environments where it is technically and financially difficult to operate.  Gazprom controls neither the capital nor the technology needed for the task.  The state-controlled company is already highly indebted and faces many expensive obligations that drain its coffers, such as supplying Russia and its friends with cheap gas.