Page 8 - FSUOGM Week 43 2021

FSUOGM PIPELINES & TRANSPORT FSUOGM

Russian banks expand support

for Arctic LNG-2

RUSSIA RUSSIAN banks have agreed to increase their stream in 2023. This will be followed by its sec-
financial support for the Novatek-led Arctic ond and third trains in 2024 and 2025, bringing
Novatek and its LNG-2 project, as its investors continue their its overall liquefaction capacity to 19.8mn tonnes
partners are seeking search for $11bn of external financing. per year (tpy).
$11bn in external Russia’s Sberbank, Gazprombank, Bank GPB Novatek CEO Leonid Mikhelson said at the
financing. International, VEB.RF and Bank Otkritie Finan- start of September that Japanese and Chinese
cial Corp. agreed in April to provide a €3.11bn banks might provide more funds, and some
($3.76bn) credit line facility for the liquefaction $1bn was expected to come from France and
project. They have now increased this to €5.7bn. Germany. However, European environmental-
External financing is expected to cover ists have urged their governments not to support
around half of Arctic LNG-2’s overall cost of the project because of its climate impact.
$21.3bn. The rest will be provided by the pro- “We have [European] partners in place, while
ject’s shareholders. Novatek operates Arctic we don’t see support from the government of
LNG-2 with a 60% interest, while French partner these partners,” Mikhelson said. “We have credit
TotalEnergies and China’s CNPC and CNOOC lines open for the third of the total financing
each hold 10%, and Japanese firms Mitsui and from the Russian banks. We can raise it from a
JOGMEC have 5% stakes. third to 60%.”
A final investment decision (FID) on Arc- Two Indian companies, Petronet LNG and
tic LNG-2 is already in place, although diffi- ONGC Videsh Ltd (OVL), were reported to be
culties obtaining sufficient external financing in talks on acquiring a stake in Arctic LNG-2 in
could slow down the project’s implementation. early September. Novatek has said it will main-
However, Novatek insists the project remains tain an interest of at least 50.1% in the project,
on schedule, with its first train due to come on leaving potentially a 9.9% stake up for grabs. ™

P8 www. NEWSBASE .com Week 43 27•October•2021