January Russian LNG exports fell slightly short of the December record

January exports of Russian LNG fell slightly short of the record set in December and amounted to 2.9 million tons versus 3.17 million tons a month earlier. Most of the cargo from the Russian Federation in January went to Japan, Spain and France. At the same time, shipments to Japan from Gazprom’s Sakhalin-2 project decreased in January, and NOVATEK had to redirect cargo to China to a route around Africa instead of the Suez Canal, which increases transportation costs. The market expects the start of shipments from the first line of NOVATEK’s Arctic LNG-2 in February.

LNG exports from the Russian Federation in January decreased slightly compared to December 2023, when LNG plants exported a record monthly volume of 3.17 million tons.

As of January 31, shipments amounted to 2.9 million tons, according to Kpler data.

Of these volumes, 1.53 million tons went to Europe, 1 million tons to Asia, and the directions of the remaining shipments are still unclear. Including 0.58 million tons went to Japan, 0.514 million tons each went to Spain and France. Belgium was also a major buyer, purchasing 0.258 million tons from the Russian Federation.

Shipments from NOVATEK’s Yamal LNG in January amounted to 1.82 million tons, which is lower than in December, but more than last year’s average. The NOVAEK Cryogas-Vysotsk plant increased exports by 47% year-on-year, to 0.066 million tons.

Gazprom’s Sakhalin-2 exported 0.897 million tons against a record 1 million tons in December. In January, Japan, which from October to December chose all its contractual obligations with Sakhalin-2, sharply reduced purchases to 0.58 million tons, which is 10% lower than in January 2023 and 23% less. than in December. Supplies to China have halved compared to both January last year and December. But in January, supplies to South Korea doubled – to 0.13 million tons.

Gazprom’s medium-tonnage Port LNG plant exported 0.13 million tons in January, which is 81% more than a year earlier. Most of the cargo went to Turkey. The company has reduced supplies to its second key export destination, Greece, in recent months.

Continued attacks on tankers in the Red Sea forced NOVATEK to make four transfers to the LNG tankers Generva, Clean Horizon, Clean Vision and Yenisei River in Zeebrugge and send them to China not through the Suez Canal, as usual, but bypassing Africa through the Cape of Good Hope. “The route through the Cape of Good Hope increases the evaporation of LNG en route (boil-off) by 600–700 tons, that is, such volumes are lost simply due to time,” notes Victor Katona from Kpler. At the moment, according to him, there is not a single LNG gas carrier in the Red Sea. Thus, in January, transit through the Suez Canal fell by 75% compared to December, and only ten loaded tankers passed through the Bab el-Mandeb Strait towards Asia.

The Russian government expects that already in February NOVATEK will begin shipments from the first line of the new LNG project Arctic LNG-2, which will also increase average monthly shipments.

Deputy Prime Minister Alexander Novak predicted that LNG exports in 2024, due to the commissioning of the first line of the project, will reach 38 million tons versus 32.3 million tons in 2023.

Independent expert Alexander Sobko notes that this year an increase in exports from Yamal LNG and Sakhalin-2 is expected, since there will be no significant amount of planned technical work, which in total will add 2 million tons to last year’s level. The main uncertainty is the situation with Arctic LNG-2: apparently, in the first months the line will operate at about half its capacity, Mr. Sobko expects. Thus, even in an optimistic scenario, the first line of Arctic LNG-2 will produce about 4 million tons of LNG this year. “So far, production is just getting set up, and the first shipment from Arctic LNG-2 is scheduled for February. One gas carrier carries approximately 80 thousand tons of LNG. For comparison, the planned 6.6 million tons of annual capacity corresponds to 550 thousand tons of LNG production per month,” says the analyst.

Tatiana Dyatel