Russian LNG Ventures Discussed at Spief

Russian companies held talks June 1 to progress various LNG projects during the St. Petersburg International Economic Forum (Spief).

Gazprom CEO Alexei Miller had separate meetings with senior executives of Japanese Mitsui and Itochu, while Novatek inked an unrelated agreement with Russian partners.

Both Japanese firms expressed interest in Gazprom's Baltic LNG planned 10mn mt/yr export project at Ust-Luga, the Russian gas giant said. As well as potentially supplying LNG to customers out of the region, the venture could become a source of supply for the region's thriving LNG bunkering market.

Ust-Luga seaport on Russia's Baltic coast (Photo credit: Ust-Luga company)

Gazprom and Mitsui also considered further steps under a strategic agreement signed in December last year, the Russian firm said June 1. The two parties discussed construction of the third train of the Sakhalin II LNG plant. Partnership in LNG bunkering space was also discussed.

Mitsui is a partner in the Sakhalin II project with 12.5% share. Other shareholders are Gazprom, Shell and Mitsubishi. In 2015, Gazprom and Shell signed the memorandum on implementing the construction project for the third train of the LNG plant. Development of the FEED documents for the third train is said to be nearing completion. Gazprom also held talks May 31 on future broad cooperation with Russian shipowner Sovcomflot.

Novatek mulls cookie-cutter approach for Arctic LNG 2

Russian gas independent Novatek said June 1 it signed a memo of understanding at Spief for a special investment contract with Russia’s industry and trade ministry and the Murmansk regional government to create a new centre for large-scale offshore structures in Belokamenka, near Murmansk.

The Yamal LNG development, expected to start exports this year, is led by Novatek.

Novatek CEO Leonid Mikhelson said: “With the construction of the Kola Yard we plan to meet the challenge of maximizing the localisation of production of LNG-plants based on the gravity-based structures, ready-made for producing LNG”. It’s likely that Novatek and Russian authorities are looking at replicating modules built for Yamal LNG at its planned Arctic LNG 2 project, also in Russia's far north. The latter has yet to take a final investment decision; a month ago Novatek signed up potential technical partners; last year Marubeni expressed interest in becoming an equity partner.

Novatek also signed a MOU with Belgian gas grid and LNG terminal operator Fluxys, in which the duo say they intend to pursue strategic cooperation in developing small-scale LNG projects in Europe, optimising LNG logistics, as well as other potential projects involving LNG. The Novatek release said cooperation would also include developing LNG marketing in Europe and Latin America - however Fluxys does not currently market any LNG. 

Shardul Sharma,  Mark Smedley