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Novatek signs small-scale LNG cooperation agreements

Russia’s largest independent gas producer, PAO Novatek inked two domestic small-scale LNG deals with the Governments of the Moscow and Samara Regions.

The Russian LNG producer aims to expand the use of LNG as motor fuel and for gas supply to off-grid customers, including the construction of small-scale LNG plants and relevant sales infrastructure.

“The use of LNG in transportation and for gas supply will improve the economic efficiency, reduce environmental footprint and enhance security of power supply, as well as make a positive contribution to social and economic situation in the regions where we operate”, noted Leonid Mikhelson, Novatek’s Chairman of the Management Board.

“Development of the domestic LNG market is a prospective business line for the company, that will help effectively monetise our abundant natural gas reserves as well as pioneer Russian technologies and equipment,” added Mr Mikhelson.

Novatek is the largest LNG producer in Russia. However, the company’s two LNG projects were hit by the European sanctions imposed against Russia. Its first operating export facility, Yamal LNG, is struggling to secure European buyers, while there are serious delays in the construction of its second project, the Arctic LNG 2 facility, on the eastern banks of the Ob Bay, which could constrain future global LNG supply.

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