CEO says Novatek to make Arctic LNG-2 invest decision in 2019

SABETTA, Yamalo-Nenets Autonomous District, Jan 25 (PRIME) -- Russian gas producer Novatek will decide whether to invest in a U.S. $27 billion Arctic LNG-2 liquefied natural gas (LNG) project in 2019, CEO Leonid Mikhelson told reporters on Friday.

“Novatek plans to make an investment decision on Arctic LNG-2 this year,” Mikhelson said. He also said that the level of local production of the equipment needed for the project will be clear until the end of 2019 and that at least 70–80% of the equipment must be produced in Russia.

“We hope that special investment deal decisions will be made in the next three–four months and that we will be able to answer the question on the level of local production that we stipulate until the end of the year,” Mikhelson said.

Novatek will consider raising investment in 2020–2021 in an ambitious plan of producing 70 million tonnes of LNG by 2030, he said. The current LNG output plan amounts to 57 million tonnes and requires 2.5 trillion rubles of investment per year.

Novatek’s projects will ensure loading the Northeast Passage with 46.5 million tonnes of cargo out of a total plan of 80 million tonnes by mid-2020, Mikhelson said.

Deputy Prime Minister Dmitry Kozak told Mikhelson that producers of LNG equipment will get all possible preferences under investment contracts.

The Arctic LNG-2 plant will be launched in 2022–2025 and fields of the Gydan Peninsula in the north of West Siberia will become its resource base. The facility is to produce 19.8 million tonnes of LNG per year.

(66.0016 rubles – U.S. $1)

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