Russia to Be 5th LNG Producer by 2025: Novatek

Russia will rise to fifth-ranked among the world's top LNG producing nations, once Novatek's two LNG projects reach full capacity.

So said the company's CEO Leonid Mikhelson at a July 4 meeting of the leaders of Russia and China, attended by representatives of public organisations, business circles and the media of both countries.

He said that would represent a move up from ninth-placed now, although 2016 published data suggest Russia was the seventh largest global LNG supplier.

“The Yamal LNG first line is already undergoing commissioning, we plan to start production at the end of this year, and in 2018-2019 the second and third stages of the project will be launched,” he said.

Mikhelson expressed his gratitude to the leadership of Russia and China for supporting the Yamal LNG project, which had allowed Russian-Chinese financing to be implemented at the set time.

“As part of the government's decree, Novatek has started designing the next, Arctic LNG-2, project on the Gydan Peninsula, with the combined capacity of Yamal LNG and Arctic LNG at about 35mn metric tons,” the head of the company said.

The capacity of the Yamal LNG project will be 16.5mn mt/year at the resource base of the South Tambee deposit. The shareholders of the project are Novatek 50.1%, Total 20%, Chinese state CNPC 20% and Chinese state investor Silk Road Fund 9.9%.

Arctic LNG-2 is Novatek's second LNG project; its planned launch is 2022-2025 and its resource base will be gas deposits on the Gydan Peninsula. 

Mikhelson did not say which would be bigger LNG exporters than Russia in 2025, but they are likely still to include the US, Australia and Qatar.

The top LNG supplying nations, according to cargo imported in 2016, were Qatar 79.62mn metric tons, Australia 44.88mn mt, Malaysia 25.08mn mt, Indonesia 19.95mn mt, Nigeria 17.78mn mt, Algeria 11.44mn mt, with Russia in 7th place supplying 10.7mn mt, just ahead of Trinidad's 10.46mn mt, according to data from the International LNG Importers' Group (GIIGNL) published this April. Russia's share of the world LNG market in 2016 was 4.1%.

Azerbaijan Desk