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Novatek eyes investment into global LNG projects

April 21, 13:28 UTC+3
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MOSCOW, April 21. /TASS/. Novatek is considering opportunities of investments into liquefied natural gas (LNG) projects, chief executive officer of the Russian natural gas producer Leonid Mikhelson said on Friday.

"We are interested in investments into the LNG market. We have created a sound gas sales portfolio on the domestic market and we would also like to have a guaranteed portfolio on the LNG market. We are present in Europe, you know. We are buying and selling about 3 bln cubic meters of pipeline gas. Certainly, we are interested in the bunkering business and the heavy truck transport refueling business," Mikhelson said. 

Not merely the European market but the global market is meant in this case, the top manager said. "As you know, there is no European oil market or US oil market or Middle East market. The global market exists. The LNG market will eventually turn into such market," Mikhelson added.

Meanwhile, the company is also discussing investments into LNG projects with Russia’s LNG engineering solutions provider Cryogas, Mikhelson said. "We are holding talks on investments into LNG business under the auspices of Cryogas," he said.

Hydracarbon production 

Novatek  also plans to maintain its hydrocarbon production rate plateau in 2017 at the current level, the head of the company told journalists.

"We are now negotiating a lot and considering the possibility to create an additional resource base for our Yamal LNG project, as well as an additional resource base in the region for our existing infrastructure. I mean the Urengoy region and increasing our production capabilities there. Before the end of this year, we will be able to form this resource base, which will allow us to support the production plateau and to maintain our share on the domestic gas market," he said.

The CEO also noted that the company maintains its plans on launching the Yamal LNG plant by the end of the year.

"It's impossible to specify any dates and terms, it's a huge work on bedding and commissioning," he said, answering the question whether the project may be put into operation in October this year.

"I am sure that by the end of the year we will launch it," he said.

The launch of the Yamal LNG plant with a capacity of 16.5 million tonnes of liquefied natural gas per year is expected this year. The project’s cost is estimated at $27 bln.

The shareholders of Yamal LNG are Novatek (50.1%), Total (20%), CNPC (20%), as well as the Silk Road Foundation (9.9%). Almost the entire volume of LNG that will be produced at the plant has already been contracted (96%).

In November 2016, Mikhelson said that the construction of the first line of the plant has already been completed by 85%, the commissioning of the first line is expected at the end of 2017.

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