European Commission Clears Total-Novatek Yamal LNG Stake

The European Commission has today approved a bid by Total subsidiary Total E&P Yamal and Novatek to take joint control of the Yamal LNG project in Russia.

Total has now been cleared to take a 20 per cent stake in the Yamal LNG project under the EU Merger Regulation and can now take control of the project with Novatek. The approval clears the deal of any antitrust or anti-competition conflicts that could exist.

"The operation was examined under the simplified merger review procedure," a statement for the Commission said.

The deal had previously been approved by the Russian Federation’s Strategic Investment Committee and Federal Anti-Monopoly Service in July and August of last year.

Novatek reduced its 100 per cent in Yamal LNG stake to an 80 per cent stake in September of last year granting what it calls "strategic partner" while Total a 20 per cent stake in the project.

Under the agreement, Total will provide the financing for the Yamal LNG project, which will include the construction of an LNG plant.

"[Total's] consideration includes a payment for the 20 per cent participation interest as well as financing for the project through the charter capital of Yamal LNG and disproportional shareholder loans," a statement for Novatek said at the time.

The plant will deal with 15 million tonnes of liquefied natural gas a year.