Russian energy company Novatek has announced that its subsidiary Novatek Gas & Power Asia has signed a long-term contract with the Chinese state-owned company Shenergy Group. The contract is for the supply of liquefied natural gas to be produced at the new Arctic LNG 2 plant, now under construction on northern Russia’s Gydan Peninsula.
Under the long-term contract with the Chinese company, the Novatek subsidiary will deliver over 3 million tonnes of LNG annually to terminals in China over a period of 15 years. The liquefied natural gas will come from the Arctic LNG 2 production plant.
The contract is consistent with the Russian company’s strategy. The company’s top boss Leonid Mikhelson emphasizes that one of its goals is to diversify the customer base and acquire new clients in the emerging Asian and Pacific markets. The new Arctic LNG 2 plant’s production capacity, he said, will be sufficient to supply customers with liquefied natural gas for many decades.
Mikhelson noted that China is a key region in Novatek’s marketing strategy. He added that the Russian company has plans to increase LNG supplies to China in the future.
According to official information provided by Novatek, at the end of 2020, the Arctic LNG 2 production facility was 32 per cent ready, while work on the first condensation plant had just reached 46 per cent of the way towards completion.
In total, Arctic LNG 2 will consist of three condensing lines. Their total production capacity will be 19.8 million tonnes of liquefied natural gas per year.
By Martin Chomsky (photo: Novatek PAO)