By March 29, 2017 0 Comments Read More →

Russian LNG production in Arctic to be over 70 million tonnes/year

Russian LNG

Russian LNG production from the Arctic is expected to hit 70 million tonnes/year. Novatek photo.

Russian LNG exports mostly to Asia

Russian LNG production from its remote Arctic regions may reach over 70 million tonnes, according to the head of gas producer Novatek.

Reuters reports Leonid Mikhelson, head and co-owner of Novatek told a conference “The Gydan and Yamal peninsulas have a vast resource base that allows the production of over 70 million tonnes (of LNG); it is comparable to LNG production in Qatar.”

Novatek was put on the list of Russian firms sanctioned by the West over the country’s role in the Ukraine crisis.  The company plans to ship its first LNG cargo from the Yamal LNG plant in December, mainly to Asian markets.

According to Mikhelson, construction of the first train of the Arctic LNG-2 plant will be completed in 2022-2023. This new plant will liquefy gas from the Gydan peninsula which is located in the province next to where Gazprom holds gas deposits.

Reuters reports Mikhelson is willing to build an alliance with Gazprom to produce gas in the Arctic.  In the past, Novatek was in talks with Gazprom concerning purchasing Yamal gas fields.

“I would welcome partnerships like that. A lack of attention is paid to gas monetisation (at Gydan and Yamal),” he said.

Mikhelson said output at the Arctic LNG 2 plant will be “the same as at Yamal LNG plant or a bit higher.”  By 2019, Yamal is expected to produce 16.5 million tonnes of LNG and 1.2 million tonnes of gas condensate.

Novatek may sell up to a 49 per cent stake in Arctic LNG to foreign investors, depending on the amount shareholders would invest and the volumes they would commit to buying, says Mikhelson.

Canadian Exploration Expense

 

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