LNG

The British government is anticipated to announce new sanctions today targeting Russia’s illicit shadow fleet for oil and LNG, following the interception of a sanctioned Russian oil tanker in the Channel on Sunday. The move could disrupt a segment of LNG trade that relied on opaque shipping and financing channels.

Britain has eased restrictions on Russian LNG shipping by issuing a temporary licence for cargoes from the Sakhalin-2 and Yamal terminals bound for third countries, as Whitehall responds to tighter gas markets and soaring energy prices. The carve-out runs until January 1, 2027, and only applies to contracts with a duration of one year or less.

Buyers in the EU have been snapping up all LNG from Russia’s Yamal terminal they can secure, just month before a full EU ban on Russian gas exports will take effect at the start of 2027.

EU member states spent more than €7.2 billion ($8.4 billion) on Yamal LNG last year – despite a full ban on LNG imports coming into force on January 1, 2027.  “Russia has no adequate alternative to the EU market,” Urgewalt analysts commented, noting more than three-quarters of all Yamal LNG exports currently go to Europe.

Russia's first open sea ship-to-ship LNG transfer is becoming a blueprint for how companies close to the Kremlin can circumvent Western sanctions. Tanker ‘Perle’ carried out the transfer off Malaysia ten days ago, and analysts reckon similar transfers are planned as Russia seeks to redirect LNG cargoes from Europe to Asia in 2026.

Saipem has signed an agreement with Technip France and NIPIgaspererabotka to participate in the Arctic LNG2 joint venture project. 

July 11 (LNGJ) - Russian natural gas company and Yamal LNG plant operator Novatek and JSC Atomenergomash, a mechanical engineering division of Russia’s nuclear body Rosatom State Corp., have signed a memorandum of understanding on forming a strategic partnership for localizing the fabrication of equipment for LNG production

   The accord notes the results already achieved on the fabrication of coil-wound heat exchangers and medium-tonnage cryogenic pumps and establishes obligations for both parties to cooperate on the design, manufacture and testing of high-tonnage cryogenic pumps. Novatek and Atomenergomash said they intended to pursue long-term cooperation to localize the fabrication of pumps, heat exchangers and other equipment for Novatek’s LNG projects at the facilities of Atomenergomash, which manufactures components for all Russian-design nuclear power plants currently under construction in Russia and elsewhere.

Two more Arc7 ice-class liquefied natural gas carriers are entering service to transport shipments produced at the Yamal liquefied natural gas plant in northern Siberia, operated by Russian natural gas company Novatek, taking the number in the Yamal fleet to 13 vessels.

Executives said the next two ships to join the fleet are the “Nikolay Urvantsev” and the “Vladimir Voronin” after they complete sea trials.

All the ships delivered so far have been built by Daewoo Shipbuilding and Marine Engineering in South Korea and have capacities of between 170,000 cubic metres and 172,600 cubic metres.

The “Nikolay Urvantsev” is owned by the Japanese company Mitsui OSK Lines. Other vessels are owned or operated by a variety of companies, including Bermuda-based Teekay LNG, Greek shipping line Dynagas and Russia's Sovcomflot.

All but one of the tankers are named after Russian Arctic explorers or scientists.

The first Arc7 tanker, the “Christophe De Margerie”, is named after the late Chief Executive of French energy major Total who died in a plane crash near Moscow in 2014.

Total is a major investor in Novatek and in the Yamal plant.

The 11th completed vessel, the “Nikolay Yevgenov”, underwent sea trials in April and delivered its first cargo in early June.

A 14th vessel of the 15 on order, the “Yakov Gakkel”, is at the DSME yard and is also set to begin trials. The 15th ship is as yet unnamed.

The tankers have been delivering Yamal shipments since the facility began operations in December 2017.

The plant comprises three liquefaction Trains with a total nameplate capacity of 16.5 million tonnes per annum, or 5.5 MTPA per LNG train.

Yamal is dependent on the ice-breaker tankers to ship LNG from Arctic waters to Western Europe and Asia.

Novatek said it had asked DSME to speed up construction and delivery of the tankers after production at the LNG plant ramped up faster than expected.

Many of the carriers have conducted ship-to-ship LNG transfers to conventional carriers, particularly offshore Norway, though during the summer months they can traverse the Northern Sea Route eastwards to North Asian countries.

Other ships in the fleet include the “Georgiy Brusilov”, delivered in November 2018 and the “Boris Davidov” in December and they are operated by Dynagas.

Among the other ships in the Arc7 fleet are the “Boris Vilkitsky”, the “Fedor Litke”, the “Eduard Toll”, the “Vladimir Rusanov”, the “Rudolf Samoylovich” and the “Vladimir Vize”.

Novatek, the Russian main shareholder in the Yamal LNG export project that has just started operations in northeast Siberia, said the first cargo was sold to the UK LNG subsidiary of Malaysian energy company Petronas, joint owner of the Dragon import terminal in the UK port of Milford Haven.

June 29 (LNGJ) - Mitsui OSK Lines, the Japanese shipping company, said it signed long-term charter contracts to provide four LNG carriers, each with capacity of 174,000 cubic metres, to the Yamal LNG project in Arctic Russia from 2019. The four contracted carriers will transport LNG trans-shipped by the project to and from Western Europe. “While demand for LNG transport will greatly grow, by leveraging experience and know-how as owners of one of the world's largest LNG carrier fleets, the MOL Group continually takes a proactive stance in meeting customer needs,” the company said.