The Russian plant “Arctic LNG-2” stopped work due to sanctions
29.10.2024 - 09:32
Russia’s largest project for the production of liquefied natural gas “Arctic LNG-2” has stopped work after another round of US sanctions.
This is reported by Bloomberg with reference to sources familiar with the situation.
According to the interlocutors of the agency, the plant, which cost $25 billion and was built for almost 10 years, cannot find buyers for its gas, as a result of which it accumulates unsold reserves. In October, Novatek reduced gas production for Arctic LNG-2 to 5.3 million cubic meters per day, which is more than double the level of September (12.1 million cubic meters per day).
Commercial gas liquefaction at the plant has stopped, with only operations necessary to maintain its technical condition continuing, Bloomberg sources say. Since August, Arctic LNG-2 has shipped eight batches of LNG, but none of them have been sold, despite Novatek offering discounts of up to 40% to market prices.
Gas buyers are afraid to accept gas carriers from “Arctic LNG-2”, against which the US imposed sanctions: in August, eight vessels related to the project were blacklisted. The Novatek plant itself came under US sanctions last November, after which foreign shareholders froze their participation, and the South Korean shipyard refused to supply ice-class gas carriers.
Earlier, USM reported that India will not buy gas from the sub-sanctioned Arctic LNG 2 project.
