Page 14 - GLNG Week 08 2022

GLNG EUROPE GLNG

Novatek revives Obskiy LNG project

PROJECTS & NOVATEK has revived plans for the single-train Critically, though, Obskiy LNG will no longer
COMPANIES Obskiy LNG plant in Russia’s far north, with the employ Novatek’s proprietary Arctic Cascade
terminal set to have a capacity of 6.6mn tonnes technology, and will instead rely on a foreign
per year (tpy), Russian business daily Kommer- alternative. Arctic Cascade has been test-trialled
sant reported last week. at a fourth, small-sized liquefaction terminal.
Novatek originally intended to build a 4.8mn It was eventually launched in May 2021 after
tpy LNG terminal at the site on the Yamal Penin- repeated delays.
sula, underpinned by 350bn cubic metres of gas In 2020, the Russian press reported that some
reserves at the West-Seyakhinskoye and Verkh- of the fourth train’s processing pipelines had
netiuteyskoye fields. But it subsequently revised been designed incorrectly, and Novatek has also
the project’s scope to include blue hydrogen and attributed delays to the coronavirus (COVID-
ammonia production that could be exported 19) pandemic and subsequent slump in global
as clean fuels to Europe, without specifying gas prices. But operational problems since its
whether LNG would still be part of the plan. launch have also been reported.
Thanks to a further 450 bcm of gas being Russia is anxious to reduce dependence on
confirmed at the Arkticheskoye and Neytin- foreign equipment and technology in its LNG
skoye fields, Kommersant said Novatek had now industry, in order to shield the sector from pos-
decided to go ahead with both LNG and hydro- sible future Western sanctions. But Novatek has
gen and ammonia production. It is expected to so far relied mostly on imported equipment and
go online in 2026 or 2027, and citing sources, the technology for its large-scale LNG plants, and
newspaper said that France’s TotalEnergies had has also ordered most of its LNG carriers from
already shown interest in the project. TotalEner- foreign shipyards, after securing exemptions
gies is an investor in Novatek’s Yamal LNG and from recently introduced rules that state that
Arctic LNG-2 terminals. such vessels must be built domestically.™

OCEANIA

ConocoPhillips completes purchase

of additional APLNG stake

INVESTMENT CONOCOPHILLIPS announced on February of distributions from APLNG in 2022, with
17 that its Australian subsidiary had completed around $500mn anticipated in the first quarter
its $1.645bn purchase of an additional 10% stake of the year.
in the Australia Pacific LNG (APLNG) project The transaction is the latest of several that
from Origin Energy. After customary adjust- ConocoPhillips has engaged in across the
ments, ConocoPhillips paid roughly AUD2.0bn Asia-Pacific region in recent years. The com-
($1.4bn) for the stake, which was funded by cash pany sold its Australia-West assets to Santos
from the company’s balance sheet. in May 2020. When it announced in Decem-
The transaction comes after ConocoPhil- ber that it would purchase the APLNG stake, it
lips opted to exercise its pre-emptive right to also said it was selling its assets in Indonesia for
acquire the stake on December 8, negating the $1.355bn.
previously announced purchase of the stake by ConocoPhillips’ CEO, Ryan Lance, said at
institutional investor EIG Global Energy Part- the time that the two transactions were aimed
ners. China’s Sinopec, the third shareholder in at lowering the company’s aggregate decline rate
APLNG, then had until December 17 to exercise while diversifying its product mix.
its own pre-emptive right to buy the stake but Origin disclosed a one-time impairment
opted not to do so. charge of AUD131mn ($94mn) related to
Following the closure of the stake sale this the sale of the APLNG stake this week. It also
week, ConocoPhillips owns a 47.5% interest in noted that it had achieved higher earnings from
APLNG, while Origin and Sinopec have 27.5% APLNG in the second half of 2021, though it
and 25% stakes respectively. ConocoPhillips said added that these had been offset by lower earn-
that it would now expect roughly $1.8bn worth ings in energy markets.™

P14 www. NEWSBASE .com Week 08 25•February•2022