Arctic LNG 2 has received FID approval from Novatek, Total and its shareholders, clearing the way for Russia’s Largest LNG Project Yet.
Commenting on the FID, Novatek’s Chairman Leonid Mikhelson, said “Today, we have taken another step forward in our goal to become one of the largest LNG producers in the world by approving the final investment decision on our second large scale LNG project Arctic LNG 2.”
Located on the Gydan Peninsula, Russia, the project will have three liquefaction plants with a total production capacity of 19.8 mta and is expected to export its first LNG cargo by 2023.
Arctic LNG 2’s second train will be commissioned in 2024, and the third train in 2026
Developed at a cost of US$21.3Billion, Arctic LNG 2 stakeholders are Novatek with a 60% interest and Total, CNOOC, CNPC and Japan Arctic LNG, a Mitsui-Jogmec consortium, each with a direct 10% interest.
Total also owns an 11.6% indirect participation in Arctic LNG 2 through its 19.4% stake in Novatek, controlling an aggregated economic interest of 21.6% in the project.
Total, with a 20% interest, and Novatek, with a 50.1% share, are also partners in US$26.9 Billion Yamal LNG, a project with a nameplate capacity of 16.5 mta located in Arctic Circle on the Yamal Peninsula. Other stakeholders in Yamal LNG are China’s CNPC (20%) and China Silk Road Fund (9.9%).
“Arctic LNG 2 will leverage the success of the Yamal LNG project and will deliver competitive LNG to the markets in four years’ time,” said Total Chairman and Chief Executive Patrick Pouyanné.
Arctic LNG2’s three trains, each with a capacity of 6.6 mta, will be fed by the resources of the Utrenneye onshore gas and condensate field.
The close proximity to Yamal LNG will allow Arctic LNG 2 to leverage synergies with existing infrastructure and logistics facilities.
Arctic LNG 2 production will be delivered to international markets by a fleet of ice-class LNG carriers using the Northern Sea Route and the transshipment terminal in Kamchatka for cargoes destined for Asia and the transshipment terminal close to Murmansk for cargoes destined for Europe.
A consortium of TechnipFMC, Saipem and Nipigas were awarded the contract for engineering, procurement and construction of the LNG plant, with the design and construction of gravity based structures to be built by the Russian company Saren, a joint venture of RHI Russia and Saipem.