HomeNewsRussia's Novatek postpones start of Arctic LNG 2 third line

Russia's Novatek postpones start of Arctic LNG 2 third line

8/23/2024

Russian natural gas company Novatek has postponed the start of operations at the third line of the Arctic LNG 2 project to 2028 from 2026, RBC media reported on Thursday, citing two sources familiar with the project implementation.

The project, yet to start full-scale liquefied natural gas (LNG) exports from the Arctic peninsular of Gydan, is subject to Western sanctions over Russia's conflict with Ukraine.

The sanctions have made it difficult for Novatek to secure enough gas carriers for shipments as well as access to the necessary equipment for production of the gas, which is liquefied at a temperature of minus –163°C (–261°F).

Reuters reported in April that Novatek might scale back Arctic LNG 2 after Western sanctions curbed its access to ice-class tankers and that it could instead focus on developing its project at the ice-free port of Murmansk.

The head of Arctic LNG 2 stakeholder TotalEnergies said in February that the project's third train had been put on hold but the second train was likely to be installed.

One of the RBC sources said that Novatek will "definitely" build the third line of the project.

Novatek did not immediately reply to a request for comment.

The possible scaling back of Arctic LNG 2 would complicate Moscow's aim of boosting its share of the global LNG market to a fifth between 2030 and 2035, up from about 8% currently.

The project had been due to become Russia's largest such plant with eventual output of 19.8 metric MMtpy of LNG and 1.6 MMtpy of stable gas condensate from three trains.

 

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