French Energy concern TOTAL takes on 10% share of Russian Arctic LNG project.

Deal was signed at the International St. Petersburg Economic Forum

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German RT reports

The French energy company Total will acquire a 10% stake in Novatek’s Russian LNG-2 project in the Arctic, said Novatek’s chief executive Leonid Mikhelson. French President Emmanuel Macron attended the International St. Petersburg Economic Forum. During his visit, the deal for Total’s participation in the Russian Liquefied Natural Gas (LNG) project was signed. Novatek is Russia’s largest independent producer of Natural gas.

Total already holds a 20 percent stake in Novatek andis one of the partners developing the Russian company’s first liquefied natural gas project in Jamal. Two other partners are with China’s Silk Road Fund and the China National Petroleum Corporation. According to Mikhelson, this second deal for participation in the Arctic LNG 2 could be completed in the first quarter of 2019, with a value of approximately $ 25.5 billion. The final investment decision would be made in the second half of 2019.

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Total, according to Novatek’s CEO, has the opportunity to increase its stake in the project by five percent, but the Russian company intends to retain at least 60 percent of the Arctic LNG-2 project.

Total recently was forced to reconsider its involvement in the developing the South Pars field in Iran by the US reintroducing sanctions against Iran. The company has not yet withdrawn from the project, but it has already stated that it must do so unless the US Treasury grants the firm a sanction waiver. Russia’s LNG sector is not subject to sanctions that focus on unconventional oil and gas, but Total CEO Patrick Pouyanne pointed out in a press conference in Saint Petersburg that nothing was “bulletproof.”

The Jamal-LNG project began operation in December and has already shipped two million tonnes of LPG. The plant will have an annual capacity of 16.5 million tons of liquefied fuel when completed.

The Arctic LNG 2 project could become operational in 2023 and reach a capacity of 19.8 million tonnes.

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