Arctic LNG-2 Secures Financing for Entire LNGC Fleet

Russia's Novatek has secured financing for 10 Arc7 ice-class LNG carriers (LNGCs) that will deliver gas from its 19.8mn mt/yr Arctic LNG-2 project, the company's Smart LNG joint venture with Russian shipowner Sovcomflot said on September 7. Smart LNG signed a deal on funding with Russian state development bank VEB.RF for the vessels, which will be built at the Zvezda shipyard in the Russian Far East.

Novatek also signed a deal with Smart LNG on chartering 14 LNGCs for Arctic LNG-2. These two agreements mean that the company now has financing, construction and chartering contracts in place for the project's entire, 15-strong tanker fleet.

Arctic LNG-2's other investors are France's Total, China's CNPC and Cnooc and Japan's Mitsui and Jogmec.

Zvezda, which is jointly run by Russia's Rosneft, Rosneftegaz and Gazprombank, serves as the lynchpin in Russia's efforts to build up its domestic shipbuilding industry and reduce reliance on foreign yards. The LNGCs for Novatek's operational Yamal LNG terminal were all built in South Korea, but the Russian government wants to see ships for all future LNG export projects built at Zvezda.