Sibur Holding Takes Gazprom's 80% Stake in Abandoned Baltic LNG

Sibur Holdings is to acquire Gazprom's 80 per cent in the abandoned Baltic LNG project in the Gulf of Finland, Baltic LNG's general director Alexander Krasnenkov has said.

In an interview with Gazprom's corporate magazine which was published today, Mr. Krasnenkov said that Sibur, the Russian petrochemicals company,  had acquired Gazprom's 80 per cent stake in the project, with talks for Sovcomflot's remaining 20 per cent stake ongoing.

He said that Sibur intended to build a methanol plant on the site and that Sibur may take on partners in the future.

"Other companies may join the project," Platts reports him as saying.

A spokesperson for Sibur said that the site may be used for production facilities.

The Baltic LNG project was originally intended to transport between 5 and 7.2 million tonnes of liquefied natural gas a year, with an LNG plant to be built at a cost of $3.7 billion.

However, Gazprom said in 2008 that it now considered the project "inexpedient" and said that it would focus its efforts on higher priority projects.

"The all-embracing detailed analysis of the Baltic LNG project has shown that the Nord Stream pipeline construction and the Shtokman field development involving potential LNG production are more competitive projects," CEO of Gazprom Alexey Miller said at the time. "The decision was taken in this context to concentrate the company’s major resources on the execution of these higher-priority projects."

No cost or other transaction details of the sale have been released as of yet.