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staged a co-ordinated attack on Yukos in the with 1.5mn tonnes per year (tpy) of LNG.
early 2000s in order to bring its assets back under Santos’ CEO, Kevin Gallagher, said the deal
state control, ordering Russia to pay $50bn in represented the company’s first long-term LNG
compensation to shareholders. Moscow has sale from one of its major projects. It takes San-
been fighting the ruling ever since. tos closer to a final investment decision (FID) on
In a fresh setback to Russia, the Dutch Barossa, which it deferred earlier this year owing
Supreme Court “dismissed the Russian Feder- to the market downturn but now hopes to reach
ation’s application to suspend enforcement” of by the first half of 2021.
the 2014 award until the court reaches its ver- The two companies are also reported to have
dict. “The Supreme Court’s decision means that signed an agreement to jointly consider oppor-
the former shareholders can continue to enforce tunities for carbon-neutral LNG from Barossa.
the arbitral awards pending its final judgment.” The deal comes during a period where long-
Lawyers on both sides of the dispute will pres- term supply agreements have become increas-
ent their arguments to the court in early 2021, ingly rare amid low LNG prices and a growing
the court said. This represents Russia’s last legal number of options available to buyers. It illus-
avenue for reversing the award. trates that some appetite for striking long-term
offtake agreements remains, and comes as a
If you’d like to read more about the key events shaping boost to other LNG producers that are still trying
the former Soviet Union’s oil and gas sector then please to take their projects to FID.
click here for NewsBase’s FSU Monitor .
LatAmOil: Braskem Idesa blasts Cenagas
GLNG: Asian bunkering success In Mexico, Cenagas, the state-owned operator
Two significant LNG-related developments have of the country’s natural gas pipeline system, has
emerged from Asia in recent days. In a world first, announced plans to halt shipments of feedstock
Korea Gas (KOGAS) successfully carried out a to Etileno XXI, a unit of the Nanchital petro-
ship-to-ship LNG bunkering test in late November. chemical complex in Veracruz State. Braskem
(See: Kogas carries out ship-to-ship LNG bunkering Idesa, the Brazilian-Mexican partnership that
test in world first, page 15) KOGAS’ LNG carrier, owns the plant, has protested against this move,
SM Jeju LNG2, was connected a new LNG carrier calling it a “unilateral termination” that “may
built by Daewoo Shipbuilding & Marine Engi- have a material effect on the company’s operat-
neering (DSME) with a capacity of 174,000 cubic ing or financial results, depending on the timing
metres for the test. of the stoppage.”
“We believe this is a significant first step in It also reported that it had immediately sus-
creating and making a very successful market pended operations at Etileno XXI after receiving
for LNG bunkering in the future,” KOGAS was notice from Cenagas, despite the pipeline oper-
quoted by South Korean media as saying. ator’s unwillingness to wait for 48 hours in order
Elsewhere, Australia’s Santos announced on to allow for the safest possible shutdown. “[In]
December 7 that it had signed a 10-year agree- compliance with safety protocols, Braskem Idesa
ment to supply LNG from its proposed Barossa initiated procedures for the immediate interrup-
project to Diamond Gas International, a unit of tion of its operating activities,” it said.
Japan’s Mitsubishi. (See: Santos, Mitsubishi strike The supply cut comes amidst a protracted
supply deal for Barossa project, page 16) Under dispute between Braskem Idesa and Pemex, the
the agreement, Santos will supply Diamond Gas national oil company (NOC), over the terms of

Week 49 11•December•2020 www. NEWSBASE .com P7