Page 12 - GLNG Week 17 2022
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GLNG                                              EUROPE                                               GLNG


       Novatek warns of




       Arctic LNG-2 delay




        PROJECTS         PROSPECTS for Russia’s second-biggest LNG   Novatek might have to rely on its proprie-
                         exporter Novatek look in doubt, after its CEO  tary Arctic Cascade liquefaction technology at
                         Leonid  Mikhelson  warned  at  a  sharehold-  the project, Mikhelson said. Previously it was
                         ers’ meeting last week that the schedule for  expected to use technology supplied by Germa-
                         its upcoming Arctic LNG-2 project could be  ny’s Linde, but the company said on March 17 it
                         delayed because of sanctions.        was winding down its Russian business. Making
                           Arctic LNG-2 has relied significantly on  matters worse, Arctic Cascade has only been tri-
                         Western equipment and technology, not to  alled once, at a 0.9mn-tpy mini-train at Novatek’s
                         mention financing to cover its $21bn cost. But  Yamal LNG plant. And Mikhelson has acknowl-
                         sanctions have meant many Western companies  edged previously that the technology “works,
                         involved in the development have had to pull  but it is bad.” Speaking in September last year, he
                         out. Mikhelson acknowledged that the project  blamed Russian manufacturers for poor work-
                         is “strained” because of complications caused  manship, noting that the company had brought
                         by sanctions, and that Novatek may not meet its  claims against almost all the suppliers involved
                         deadlines.                           in the project.
                           Under a final investment decision (FID)   Likely reflecting the fact that some of its cap-
                         taken in 2019, Arctic LNG-2 is scheduled to  ital investment plans have been put on hold,
                         start up in 2023 and reach its full three-train  shareholders at the meeting approved the board’s
                         capacity of almost 20mn tonnes per year (tpy) in  proposal to double dividends. However, in an
                         2016. But while its equity partners in the project  announcement on April 24, the company said it
                         including France’s TotalEnergies have decided to  had decided not to publish its financial results for
                         remain, several financiers, insurers, contractors  the first quarter.™
                         and suppliers have announced their withdrawal.

          Former top Novatek executive found




          dead with family in Spain





           PROJECTS         A former top executive at Russia’s largest LNG  president at Gazprombank, the finance division
                            exporter Novatek has been found hanged at a  of Russia’s largest gas producer Gazprom.
                            Spanish villa, while his wife and daughter were   Like many Russian oil and gas majors,
                            both discovered stabbed to death, according to  Novatek has suffered a collapse in its stock price
                            local media reports on April 21.     since Moscow launched its invasion of Ukraine
                              55-year-old Sergei Protosenya, a former  in late February. From a peak market valuation
                            chief accountant at Novatek as well as a previ-  of $79bn in September last year, its worth has
                            ous member of the company’s board, was found  halved. This slump came despite soaring inter-
                            at the rented villa in the town of Lloret de Mar  national gas prices over the last half year that
                            near Barcelona on April 19, Spanish news site  have led to a surge in the value of stocks of many
                            Telecino and other local media reported. Police  international oil and gas producers.
                            are working on the assumption that either Proto-  Novatek’s operations are central to Russia’s
                            senya killed his family and then committed sui-  ambition to develop itself into a major LNG
                            cide, or that a third party killed the entire family  exporter to rival the likes of Australia, Qatar and
                            and staged it.                       the US. But sanctions have prevented the supply
                              Protosenya has an estimated wealth of  of key international equipment and technology
                            €400mn ($433mn), according to local media.  to its upcoming Arctic LNG-2, casting doubt
                            He left Novatek in 2016.             about whether the project will be completed.
                              The bodies were discovered just one day after  Novatek CEO Leonid Mikhelson conceded on
                            another affluent Russian businessman, Vladislav  April 21 that the project might miss its 2023
                            Avayev, was found dead with his wife and young-  launch deadline because of the challenges it
                            est daughter at their Moscow apartment, all with  faces.™
                            gunshot wounds. Avayev was formerly a vice





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