Novatek invests to push Arctic LNG2 | Polarjournal
The first wells are already being drilled in the “Arctic LNG2” area. The Utrenneye field is the resource base of Arctic LNG 2. The production area is located on the Gydan Peninsula, approximately 70 km from Ob Bay. (Foto: Novatek)

Russia’s largest liquefied natural gas producer Novatek plans to raise $11 billion for Arctic operations and intends to offer a 60 percent stake in the project as a deposit for long-term financing, raising the funds by the first half of this year. The investments will be made available to expand the Arctic LNG2 (LNG = Liquefied Natural Gas) production area.

Busy construction work on the Gulf of Ob. This is where the new port of loading is being built. (Foto: Novatek)

Novatek is expected to hold its annual general meeting on April 23. Novatek’s Board of Directors has asked its investors to approve the financing transaction.

“As part of the implementation of the authorized agreements, Novatek will contribute its share in the authorized capital of Arctic LNG-2 in the amount of 60% of the authorized capital,” a company spokesperson said.

The Arctic LNG2 production area is located on the eastern side of the Gulf of Ob. (Graphic: Heiner Kubny/Google)

Novatek has announced it will raise $11 billion in external funding for Arctic LNG-2 and intends to secure the funds by mid-year. Russia’s Sberbank said in January that it had agreed to provide EUR 3 billion for the project. Sberbank is the largest financial institution in Russia and is predominantly state-owned.

The $21 billion LNG-2 project is scheduled to come on stream in 2023 and produce 19.8 million tons of liquefied natural gas annually at full capacity from 2026. Novatek’s partners are the French company Total, the Chinese companies CNPC and CNOOC, and the Japanese companies Mitsui and Jogmec.

Heiner Kubny, PolarJournal

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