Page 16 - GLNG Week 43 2020

GLNG EUROPE GLNG

Rosnedra opens tender for Gydan gas block

PROJECTS & RUSSIAN subsoil licensing agency Rosnedra has Rosneft CEO Igor Sechin said in a forum
COMPANIES opened a tender for subsoil rights to the Zapad- earlier this month that the company was look-
no-Minkhovsky gas block on the Gydan Penin- ing to export 35-50mn tonnes per year (tpy) of
sula, it announced on October 21. LNG from the Arctic as part of its Vostok Oil
Zapadno-Minkhovsky spans part of Gydan venture. Authorities recently revealed that Ros-
and part of the Taz Bay. According to Rosne- neft was the only company cleared to take part
dra, it contains 329.5bn cubic metres of gas and in an upcoming auction for the nearby Deryab-
27.2mn tonnes (245mn barrels) of condensate in inskoye and Kazantsevskoye gas fields in north-
possible resources. ern Krasnoyarsk.
Bids will be accepted until November 20, with Rosneft has been trying to develop LNG
the starting price set at RUB124.2mn ($1.6mn), projects for years without success. It abandoned
Rosnedra said. Results will be announced on plans for the Pechora LNG terminal in the far
December 16. northern Nenets region in 2018 after determin-
The winner will obtain a 30-year licence to ing there were not enough resources in the area
explore for and produce hydrocarbons in the to justify its development. Its Far Eastern LNG
area. There are no special conditions set for the project has been in limbo for a decade for the
auction, meaning any operator with proven same reason.
capabilities can apply. Novatek, the only active LNG producer in
Russia’s Kommersant reported in Septem- the Russian Arctic, may also come forward
ber that Rosneft was interested in acquiring the with an offer for Zapadno-Minkhovsky. The
block. The national oil giant operates the adja- company already has the resources to under-
cent Minkhovsky area containing 210 bcm of pin its Arctic LNG-2 terminal on Gydan, due
gas, which it acquired in 2014. It is looking to on stream in 2023. But it wants to develop
build up its gas resources in the Russian Arctic another export project on the peninsula, Arc-
to establish a hub for LNG production. tic LNG-1.™

Novatek posts 24% drop in

revenues in third quarter

PERFORMANCE RUSSIA’S second-largest natural gas and leading operations,” BCS Global Markets commented on
LNG producer Novatek has reported a 24% year- October 28.
on-year decline in revenues in the third quarter While the results coming in below the con-
of 2020 under IFRS to $2.2bn, missing consensus sensus is seen as negative for the company, BCS
expectations by 2%. GM still maintained a Buy recommendation on
Novatek posted a 4.5% y/y increase in gas Novatek shares, arguing that “significant forex
output in the third quarter, and overall hydro- and commodity volatility continuing in the 3rd
carbon production growth of 3.6% y/y. quarter” will have the analysts “digging for a
But the company’s Ebitda was down by while to understand how the company actually
89% y/y (a gain of 110% quarter on quar- performed versus expectations.”
ter), while still meeting the expectations. Net BCS GM suggests focusing on comments
income of $179mn (down by 97% y/y and regarding the current LNG market environment
69% q/q) missed the consensus expectations – which appears to be recovering quickly from
by 19%. summer lows and how that may affect devel-
In the third quarter, the company’s free cash opment plans for the several new LNG projects
flow posted a positive $100mn versus $800mn Novatek has on the drawing board.
in the second quarter, as capital expenditure was Another focus is on the progress update on
cut by 43% to $500mn. Net debt dropped from Novatek’s Arctic LNG-2 project and the Train-4
$1.5bn as of the end of the second quarter to a at the flagship Yamal LNG project.
negative $0.2bn as of the end of the reporting Novatek is securing the financing for Arctic
quarter. LNG-2, its second liquefaction project to launch
“As usual in times of a volatile ruble exchange production. Its first, Yamal LNG, went on stream
rate, Novatek’s net income line was affected by in December 2017 and is now producing 17mn
forex gains and losses in its core and joint venture tonnes per year (tpy) of super-cooled gas.™

P16 www. NEWSBASE .com Week 43 30•October•2020