Russia’s gas giant Novatek has suspended production from its new Arctic LNG 2 project because of Western sanctions and a lack of LNG carriers, Reuters has reported.
Two sources told the news agency that Russia’s largest producer of LNG had aimed to start deliveries in the first quarter of this year.
But Novatek was hit by sanctions last year, resulting in overseas shareholders freezing their participation.
The producer has not commented.
“Train one will remain shut until at least the end of June,” one source told Reuters.
However, building work for the project is continuing.
Three trains in total are slated to produce 19.8m tonnes of LNG per year, plus 1.6m tonnes of stable gas condensate.
The sources said the main problem was a lack of specialist ice-class ships.
A total of 15 Arc7 ice-class LNG carrier newbuildings are being built at Russia’s Zvezda shipyard for Arctic LNG 2.
Six more Arc7 ships were due to be built by Hanwha Ocean in South Korea: three for Russia’s sanctioned state shipowner Sovcomflot and three for Japan’s Mitsui OSK Lines.
But Sovcomflot’s trio was cancelled due to sanctions.
MOL’s vessels not sanctioned
In February, TradeWinds reported that MOL’s vessels have not been included in new US sanctions.
The 172,600-cbm trio was ordered in September 2020 against long-term contracts with Novatek.
But MOL said delivery times have now been delayed, without disclosing new handover dates.
Russian Deputy Prime Minister Alexander Novak said on Friday that Novatek “is dealing with the issues, corresponding talks are underway”.
“Their main problem is with the tankers,” he added.
Novatek has a 60% stake in Arctic LNG 2, with TotalEnergies, China National Petroleum Corp and China National Offshore Oil Corp, and Mitsui & Co and JOGMEC venture Japan Arctic LNG having 10% each.
The Vedomosti newspaper reported that natural gas output at the project had fallen to 83m cbm in February, due to a delay in the start of LNG shipments.
Sources put January production at 250m cbm.
