Novatek Eyes Partners for Kamchatka LNG Depot

Russia's second LNG exporter Novatek has signed a memorandum of understanding (MoU) with Japanese Marubeni Corp and Mitsui OSK Lines to take forward the plan to establish an LNG transshipment and marketing complex in the far eastern region of Kamchatka.

The MoU defines the parties’ intentions and includes a specific action plan to explore the opportunities to establish an LNG transshipment and marketing complex in Russia's far east, including investments in this infrastructure project, it said November 28. 

CEO Leonid Mikhelson noted: "One of the main advantages of creating an LNG transshipment terminal at Kamchatka is its close proximity to consumers and the opportunity to ensure flexible sales terms for the key consuming markets of the Asian-Pacific region. The MOU demonstrates a high market interest and relevancy for this type of project to address market needs.”

The plant would allow the ice-class tankers to be used more efficiently as the need go no further than Kamchatka, for collection and onward delivery by conventional tankers. Novatek has a contract with Fluxys for storing and transshipping LNG at Zeebrugge during the winter months when there is no access to the Pacific through the Arctic Circle. This contract led to another tank being built for the Russian company, although LNG stored there cannot enter the national gas grid.

The $27bn three-train Yamal LNG plant is expected to start exports from the first train this year and it is planning to build a second facility, the so-called Arctic LNG 2, if it can bring the costs down far enough.