Page 14 - GLNG Week 30 2021

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Russia to auction off two Arctic gas fields

INVESTMENT RUSSIA plans to auction off subsoil rights to two The Neitinskoye field contains 60.3bn cubic
gas fields on September 8 on the Arctic Gydan metres in C1 and 37.1 bcm in C2 gas reserves,
Peninsula near a project that Novatek is devel- along with 10.4mn tonnes (76mn barrels) of
oping, the country’s natural resources ministry oil and 0.5mn tonnes of condensate in C1+C2
announced on July 22. And the auction terms liquid resources. The Arkticheskoye field, mean-
mean Novatek is effectively the only company while, holds 276 bcm of gas in C1 and 39.3 bcm
able to take part in the contest. in C1 gas, along with 13.4mn tonnes of oil and
The two fields are both in the vicinity of the 3.9mn tonnes of condensate.
Obsk LNG project, which was expected to pro- Novatek’s CEO, Leonid Mikhelson,
duce around 5mn tonnes per year (tpy) of LNG, requested in a letter to Russian President
but Novatek is considering reconfiguring it to Vladimir Putin that licences for the fields be
produce ammonia, hydrogen and methanol put up for sale in April. The company is eager
instead. Novatek is looking at potentially selling to build up its resource base in the Russian
a stake in the project to Japan’s Mitsui, the Mos- Arctic in order to underpin additional lique-
cow-based Kommersant newspaper reported in faction projects.
late June. Novatek secured rights to the North-Gy-
The starting price for bids for the Arktich- dansky block, also on the Gydan Peninsula, in
eskoye gas field is RUB9.9bn ($130mn), while March. That area is estimated to contain some
the starting price for the Neitinskoye field is 270 bcm of gas and Novatek paid RUB775mn
RUB2.1bn. Only companies that operate lique- ($10.2mn) for the licence.
faction facilities in the Yamalo-Nenets region The Russian company is aspiring to produce
can participate in the auctions, which effectively 70mn tonnes of LNG annually by 2030, up from
leaves Novatek as the sole contender. under 20mn tpy at present.™

MIDDLE EAST

QP nears award for NFE work

PROJECTS & STATE-OWNED Qatar Petroleum is nearing go it alone. However, having partners to market
COMPANIES the award of an onshore engineering, procure- the LNG volumes produced is thought to be the
ment and construction (EPC) contract for the main driver behind Doha’s attempt to bring in
first phase of the North Field Expansion (NFE) other participants now.
project through its Qatargas subsidiary. Reports emerged around a month ago that
The news follows reports of the submission of QP was also in talks with state-owned Chinese
bids in May by ExxonMobil, Royal Dutch Shell, companies including PetroChina and Sinopec
TotalEnergies, ConocoPhillips, Chevron and over equity stakes in the NFE project as China
Eni for work on the $28.75bn development. remains on course to become the world’s largest
Speaking to Upstream, sources close to pro- LNG importer.
ceedings said that an award is expected by the Beijing has seen trade relations worsen with
end of August for the third onshore EPC package Australia – a major supplier of the super-chilled
(Package 3), which includes offsites and utilities fuel – and Sinopec struck a 10-year supply deal
work. with QP in March, and reports of the talks sig-
One of the sources said that Tecnicas Reuni- nal a growing co-operation between China and
das of Spain and Italian firms Saipem and Tec- Qatar on LNG.
nimont are among the frontrunners to win the However, with the IOCs also now bidding
contract. to participate in NFE, it seems that Qatar has
The NFE project is set to increase Qatar’s liq- not fully turned away from Western majors yet
uefaction capacity from 79mn tonnes per year either, despite saying recently that it would not
currently to 110mn tpy by 2025 or 2026 and renew contracts with its current partners in
126mn tpy by 2027. It is the world’s single largest the Qatargas 1 LNG plant. The current 25-year
LNG project. JV arrangement with super-majors TotalEner-
QP took a final investment decision (FID) on gies (10%) and ExxonMobil (10%) as well as
NFE alone earlier this year. The company had Marubeni (7.5%) and Mitsui (7.5%) expires on
previously relied on IOCs’ expertise – as well December 31, and QP will assume full owner-
as their investments – to develop its initial liq- ship on January 1, 2022, up from its current
uefaction capacity but now has the expertise to 65% holding.™

P14 www. NEWSBASE .com Week 30 30•July•2021