Novatek CEO announces timing of investment decision on third LNG project

TASS Russian News Agency | Jan 23, 2020 at 7:50 AM

DAVOS, January 23. /TASS/. Novatek intends to make an investment decision on the construction of its third LNG project - Arctic LNG 1 - before introducing the first phase of Arctic LNG 2 in 2023. This can happen both in 2022 and in 2021, Head of Novatek Leonid Mikhelson told reporters on the sidelines of the World Economic Forum (WEF) in Davos.

"I think investment decision on the next LNG project will be made before the launch of the first phase of Arctic LNG 2 in 2023," he said. Earlier, Mikhelson named later dates.

Arctic LNG 1 will produce about 20 mln tonnes of liquefied natural gas per year. Currently, Novatek is implementing the second LNG project in Yamal - Arctic LNG - 2 with a capacity of 19.8 mln tonnes, in which Chinese CNOOC, CNPC, French Total, the Mitsui consortium and Jogmec own 10% each. The launch of the first phase of Arctic LNG 2 is planned for 2022-2023.

In addition to Arctic LNG 2, Novatek plans to build two more large plants in the region - Arctic LNG 1 and Arctic LNG 3.

At the moment, there are two natural gas liquefaction projects in Russia - the Sakhalin 2 project with a capacity of more than 10 mln tonnes, co-owned by Gazprom (50% plus one share), Shell (27.5% minus one share), Mitsui (12.5%), and Mitsubishi (10%); and Yamal LNG with a capacity of about 18.5-19 mln tonnes, with shareholders Novatek (50.1%), Total and CNPC (20% each) and the China Silk Road Fund (9.9%).