Page 9 - GLNG Week 36 2021

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Indian firms reportedly in talks over

Arctic LNG 2 stake acquisition

INVESTMENT TWO Indian companies, Petronet LNG and works to boost the share of gas in its energy mix,
ONGC Videsh Ltd (OVL), are reportedly in including LNG imports. Russia, for its part, is
discussions about buying a stake in Russia’s Arc- seeking to expand its share of the LNG export
tic LNG 2 project, which is being developed by market amid growing competition.
Novatek. The first Arctic LNG 2 liquefaction train is
The talks are centred on a 9.9% stake in the due to enter service in 2023, with the project set
liquefaction project, Bloomberg reported this to reach its full nameplate capacity of 19.8mn
week, citing a member of the Indian delegation tonnes per year (tpy) of the super-chilled fuel in
to Moscow, who is involved in the negotiations 2025. Currently, Novatek owns 60% in the $11bn
but spoke on condition of anonymity. No final project, while TotalEnergies, China National
decisions are reported to have been made as Petroleum Corp. (CNPC) and CNOOC Ltd
yet. each have 10% stakes and a Japanese consortium
None of the companies have commented holds the remaining 10%.
publicly on the matter but Indian Minister of Novatek, which is Russia’s largest LNG pro-
Petroleum and Natural Gas Hardeep Singh ducer, had initially expected European, Rus-
Puri told reporters at a briefing in Moscow that sian and Asian lenders each to provide a third
Indian firms were talking to Novatek and that of the financing for Arctic LNG 2. However, it
“everything is on the table”. Puri is also reported has faced issues obtaining loans for the project
to have met with Novatek’s CEO, Leonid Mikhel- from European lenders, according to comments
son, during an Indian energy delegation’s visit to made by Mikhelson that were cited by Bloomb-
Vladivostok last week for the Eastern Economic erg. As a result, Russian financing may end up
Forum. accounting for around 60% of the required
Reports of the discussions come as India amount, he said.™

Novatek snaps up two

more Arctic fields

INVESTMENT RUSSIA’S largest LNG exporter Novatek has facility, were allowed to file bids.
paid RUB13.2bn ($180mn) at a state aucton for The two fields are both in the vicinity of the
rights to two gas fields on the Yamal Peninsula, Obsk LNG project, which was expected to pro-
the company announced on September 8. duce around 5mn tonnes per year of LNG. But
The Arkticheskoye and Neitinskoye fields Novatek delayed taking a final investment deci-
contain a combined 2.9bn barrels of oil equiv- sion on the plan last year, and CFO Mark Gvet-
alent under Russian classification standards, vay said earlier this year that the project might be
Novatek said. This includes 413bn cubic reconfigured to produce low-carbon ammonia,
metres (bcm) of gas and 28mn tonnes of liquid hydrogen and methanol instead.
hydrocarbons. Novatek is eager to accumulate as many
Novatek’s acquisition of the fields was seen resources as it can in the Russian Arctic, to
as a given. Company CEO Leonid Mikhel- underpin the series of new LNG projects it has
son requested in a letter to Russian President in the pipeline. The company has set its sights on
Vladimir Putin that licences for the fields be producing 70mn tpy of LNG in the region by the
put up for sale in April. And the auction terms end of the decade.
that were set effectively prohibited any com- Novatek secured rights to the North-Gy-
panies from taking part in the auction. Only dansky block, also on the Gydan Peninsula, in
companies that operate liquefaction facilities March. That area is estimated to contain some
in the Yamalo-Nenets region, where the only 270 bcm of gas and Novatek paid RUB775mn
completed plant is Novatek’s Yamal LNG ($10.2mn) for the licence.™

Week 36 10•September•2021 www. NEWSBASE .com P9