“Arctic LNG-2” is “shrinking” in scale // How sanctions may affect the NOVATEK project

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NOVATEK (MOEX: NVTK) may reduce the scope of the Arctic LNG 2 project due to sanctions. The company plans to launch only two production lines, and transfer the third to the construction of a new plant in Murmansk, writes Reuters. It was planned that Arctic LNG-2 would become the largest liquefied natural gas production enterprise in Russia. The annual capacity was supposed to be almost 20 million tons of fuel and another approximately 1.5 million tons of gas condensate. However, in November 2023, the project came under blocking US sanctions, and in February 204, Sovcomflot, which was engaged in servicing special gas carriers for Arctic LNG-2, also came under restrictions. As a result, NOVATEK announced force majeure to customers regarding future fuel supplies.

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