Novatek Closes Stake Sales At Arctic LNG-2

Russia’s Novatek said on July 22 it had finalised key partnerships at the Arctic LNG-2 development, bringing the project one step closer to a final investment decision (FID).

In a statement, the independent gas producer said it had closed the sales of stakes in the planned LNG export terminal to Chinese companies CNPC and Cnooc and Japanese operators Mitsui and Japan Oil, Gas and Metals National Corp. (Jogmec). Earlier this year CNPC and Cnooc agreed to share a 20% interest in the project, while Mitsui and Jogmec signed deals to together take 10%.

“We now have formed the structure of the project's participants by successfully closing the sale of interests in Arctic LNG-2,” Novatek CEO Leonid Mikhelson said. “The target level of Novatek’s participation has been reached, allowing us to make the final investment decision and optimally use the company's cash flow to finance our new projects.”

Novatek has also sold a 10% stake in Arctic LNG-2 to France’s Total. With the latest deal closures, its ownership has therefore been reduced to 60%. The company has said it aims to take an FID this quarter on the project, which is due to start up in 2022 or 2023 and reach a liquefaction capacity of 19.8mn mt/yr.