Russian billionaire energy investor Albert Avdolyan has reportedly hired the Franco-US engineering company TechnipFMC to design and construct an LNG export plant in the Far East of the Russian republic of Yakutia.
A spokesperson for Avdolyan told reporters that the LNG project would cost around $10 billion and would export cargoes to Asia by 2025.
The LNG plant will aim to produce 13 million tonnes per annum.
Yakutia is a huge land mass and it is bigger than the combined territory of seven of the largest European Union nations, including Germany and France.
It occupies one-fifth of the territory of Russia and 40 percent of the north of Yakutia is inside the Arctic Circle.
Avdolyan’s company will have to seek permission from the Russian government to export LNG.
However, a new Russian law has been passed allowing a broader range of companies to take part in the oil and gas industry if they are investing in northern, remote regions and they can also qualify for tax breaks.
The legislation was passed by the State Duma in April 2020 and specifically allows the expansion of the list of companies entitled to export natural gas and LNG from Russia.
Russia has prioritised the development of LNG for export and the plant if it is built would be the country’s fourth.
Gazprom controls the Sakhalin LNG plant in the Russian Far East and another Russian natural gas company Novatek operates the Yamal LNG joint venture in northern Siberia, with French major Total and several Chinese companies holding stakes.
A third plant called Arctic LNG II is already in the engineering phase and will be built on the Gydan Peninsula, also on the northern Coast of Siberia. Investors in Arctic LNG II include Novatek, Total and a host of Chinese and Japanese energy companies.
The Avdolyan spokesperson said that TechnipFMC, which was involved in the construction of Novatek’s Yamal project, will work on the design of the Yakutia plant to be completed by the end of 2020.
TechnipFMC is one of the leading LNG engineering, procurement and construction companies with worldwide experience.
The company is planning to split into two separate entities with the LNG engineering spin-off being called Technip Energies. However, the process has been delayed for now.
Avdolyan has already agreed to buy a stake in another energy project in Yakutia.
In March 2020 his company announced its purchase of a 49 percent stake in the Elga coal project from the Russian lender Gazprombank.
Elga is one of the world’s biggest coking coal deposits and Avdolyan is said to have paid Gazprombank 45 billion rubles ($610 million) for the stake in the project, which will still need big invesments.
