Page 13 - FSUOGM Week 03 2021

FSUOGM PERFORMANCE FSUOGM

Novatek boosts output in 2020

despite headwinds

RUSSIA RUSSIAN private gas supplier Novatek managed France’s Total and China’s CNPC and Silk Road
a 2.8% growth in production in 2020, despite Fund.
Novatek has been market headwinds caused by the coronavirus
working to increase the (COVID-19) pandemic. Asian attraction
navigation period for its The company’s overall hydrocarbon output Recent weeks have seen a spike in LNG spot
LNG carriers. averaged 1.66mn barrels of oil equivalent per prices in Asia on the back of strong consumer
day last year, versus 1.62mn boepd in 2019. Gas demand and a plunge in temperatures. Novatek
extraction grew by 3.6% to 77.4bn cubic metres, is keen to capitalise on this premium.
while liquids output inched up 0.7% to 12.2mn In a statement, the company said the Arc7
tonnes (246,000 boepd). ice-class Christophe de Margerie LNG carrier
Novatek’s flagship project is the 17mn tonne (LNGC) had successfully completed an eastward
per year (tpy) Yamal LNG export terminal in the journey along the Northern Sea Route without
Russian Arctic, but it also has a sizeable domestic any ice-breaker support. This vessel was followed
gas sales business. by the Nikolay Yevgenov LNGC. Each tanker
The impact of the pandemic on the compa- will carry 140,000 tonnes of super-chilled gas to
ny’s international sales is difficult to determine, the Asia-Pacific region.
as it does not consolidate Yamal LNG’s financial Novatek has been working to expand the nav-
results with its own. As such, while the com- igational season for LNG shipments, and forgo-
pany reported a 30.2% decline in international ing the use of ice-breakers helps cut costs.
sales, this only accounts for the gas it bought and “[Cutting] the navigational period along the
resold from Yamal LNG on a spot basis, and not NSR by almost half the distance and time of LNG
the gas sold under contracts directly between transport to the ports of the Asia-Pacific region
Yamal LNG and buyers. More of the project’s gas compared with the traditional route through the
was sold on a spot basis in 2019 than in 2020, Suez Canal allows us to reduce our carbon foot-
as some supply contracts had not yet come into print and decrease carbon emissions by 7,000
force. tonnes per round trip,” CEO Leonid Mikhelson
Novatek is partnered at Yamal LNG with said. ™

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