HomeNewsRussia's Novatek seeks rights for gas export from planned Murmansk LNG plant

Russia's Novatek seeks rights for gas export from planned Murmansk LNG plant

6/20/2023

(Reuters) - The head of Russia's largest liquefied natural gas producer Novatek said the company is pushing for changes to the gas export law so that its future Murmansk LNG plant will be able to sell LNG abroad, TASS news agency reported on Tuesday.

Novatek announced plans earlier this month to build the Murmansk LNG plant, which will have an annual capacity of 20.4 million tons per year. The first line at the plant could start operations in 2027.

The plant will help Russia reach its goal of gaining a 20% share of the global LNG market by 2035 and expanding its annual LNG output to 120 million-140 million tons from around 32.5 million tons now.

While Novatek's currently operational plant, Yamal LNG, is one of a limited number of entities that have the right to export gas, Murmansk LNG does not.

"The export law needs to be amended so that Murmansk LNG can get the right to export," Leonid Mikhelson was quoted as saying, adding that the company has set up a working group in parliament in order to address the issue.

Mikhelson said Murmansk LNG would use Novatek's own technology, called Arctic Mix, to produce the frozen gas.

He also said Yamal LNG would produce less than 20 million tons of LNG this year, down from 21 million tons in 2022, as the second line of the plant is under maintenance.

The third line will stop for maintenance for three weeks in August, he said.

The Novatek head also expected core profit to fall by around a quarter this year, while income was seen declining by 30% due to lower LNG prices.

The company sees natural gas production rising by up to 2% this year from last year's 82 billion cubic meters, while oil and gas condensate output may also increase by 2%, Mikhelson said.

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