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Business Standard
7 hours ago
- Business
- Business Standard
Russia tries again to boost LNG exports stalled by US sanctions last year
Russia has the pieces in place to meaningfully boost LNG exports as it expands its shadow fleet Bloomberg Russia is taking another crack at expanding exports of liquefied natural gas after US sanctions stalled efforts last year. An LNG vessel has docked and then left the Arctic LNG 2 export facility for the first time since October, according to ship-tracking data compiled by Bloomberg and satellite images. The facility was supposed to be a cornerstone of Moscow's goal to triple LNG exports by 2030, but has been idle for months after struggling to find buyers willing to break Western restrictions. Russia has the pieces in place to meaningfully boost LNG exports as it expands its shadow fleet. Since the 2022 invasion of Ukraine, Russian gas pipeline exports to Europe have dwindled, and shipping more fuel via seaborne LNG tankers provides an attractive revenue stream to fill Moscow's coffers. Shadow fleet At least 13 ships, including those that can navigate icy waters, have been marshaled to potentially service Arctic LNG 2, with some changing management companies several times to help obfuscate the actual owners. According to ship-tracking data compiled by Bloomberg they include: Four ice-class vessels that can navigate the frozen waters around Arctic LNG 2. Three are currently idled in the Barents Sea, while another is the tanker currently docked at Arctic LNG 2 Three more traditional LNG vessels are in the Barents sea Two vessels are under repair in China, with another that appears to be on the way One vessel near a floating storage in Russia's Far East Two vessels are idled in the the Gulf of Finland. They had served another Russian facility called Portovaya, which was sanctioned by the US in January 'Russia does have more vessels at its disposal compared to the summer/fall of 2024,' Malte Humpert, founder of the Arctic Institute, a Washington-based think-tank, said in an email. 'If it can find buyers, this small fleet should be sufficient to lift cargoes.' Eight shipments were exported from Arctic LNG 2 between August and October 2024, but never docked on foreign shores. Instead, the gas was offloaded into two Russian storage units in the Barents Sea and its Far East region. Large-scale production halted in October after ice built up around the facility and made transport by traditional vessels challenging. Russia's first domestically built ice-class LNG tanker may come online in the second half of this year if it passes remaining sea trials, Interfax reported Wednesday, citing Sovcomflot Chief Executive Officer Igor Tonkovidov. Willing buyers? Now, the market will be closely monitoring whether Arctic LNG 2 can find willing buyers. Exporting more would be a boon for consumers, as it would put pressure on global gas prices. The Biden administration was diligent in sanctioning ships and companies connected with exporting fuel from Arctic LNG 2 last year. It isn't clear if the Trump administration will be as strict, or if the government will slap restrictions on ports that accept the fuel. The threat of retaliation from the US kept buyers at bay last year. Officials related to the Arctic LNG 2 joint venture have never stopped trying to sell the fuel, traveling to potential buyers in India and China over the last year, according to traders with knowledge of the matter. However, it isn't clear if they have been able to secure any sales. 'The biggest obstacle remains finding a buyer and shipping capacity,' Jan-Eric Fahnrich, a senior analyst at Rystad Energy, said by email. 'They will then circle around looking for buyers in Asia and Novatek will offer a discount.' Majority shareholder Novatek PJSC and the operating venture Arctic LNG 2 did not respond to emails seeking comment. Iris, the tanker that recently left Arctic LNG 2, is now heading toward the northern port of Murmansk, according to ship-tracking data. The vessel could be traveling there to offload fuel into a nearby floating storage unit or another vessel in a ship-to-ship transfer. It's not immediately clear if any LNG was loaded on the vessel. The tanker's draft level — which the crew inputs manually — didn't change after leaving the plant, the data shows, signaling it may not have loaded LNG cargo. The Iris is expected to reach Murmansk on July 1, according to the data. 'The fact that more than one million cubic meters of LNG loaded last year remains unsold, and in floating storage, does not bode well for renewed attempts to market additional volumes this summer,' said the Arctic Institute's Humpert. 'China would appear to be the most likely candidate, but with consistently declining Chinese demand for the past eight months this won't be an easy task.' Iris is also a so-called Arc4 vessel, with a reinforced hull that allows it to navigate icy waters. That would allow the ship to take the shorter Arctic route to Asia when conditions allow in the summer. Loading vessels at Arctic LNG 2 could also be necessary to ease brimming gas tanks. Satellite images taken June 25 indicate that two production trains at the facility are flaring, which indicates they could be operating or cooling down equipment. Without steady exports, the plant's storage will quickly fill up, and lack of space was one of the reasons why Arctic LNG 2 stopped large-scale production in October. Meanwhile, traders will wait to see if US or European officials further tighten restrictions on the facility as exports resume. 'Now is the time for increased pressure' on Russia's energy revenues, said Geoffrey Pyatt, distinguished fellow at the Atlantic Council Global Energy Center and a former US assistant secretary of state who helped craft Arctic LNG 2 sanctions under the Biden administration. 'European leaders have expressed new determination to end all imports of Russian gas, making it even more important that the United States maintains our pressure on Novatek.'
Mint
a day ago
- Business
- Mint
Russia Tries Again to Expand LNG Exports Upended by Sanctions
(Bloomberg) -- Russia is taking another crack at expanding exports of liquefied natural gas after US sanctions stalled efforts last year. An LNG vessel has docked at the Arctic LNG 2 export facility for the first time since October, according to ship-tracking data compiled by Bloomberg and satellite images. The facility was supposed to be a cornerstone of Moscow's goal to increase LNG exports threefold by 2030, but has been idle for months after struggling to find buyers willing to break western restrictions. Russia has the pieces in place to meaningfully boost LNG exports as it expands its shadow fleet. Since the 2022 invasion of Ukraine, Russian gas pipeline exports to Europe have dwindled, and shipping more fuel via seaborne LNG tankers provides an attractive revenue stream to fill Moscow's coffers. At least 13 ships, including those that can navigate icy waters, have been marshaled to potentially service Arctic LNG 2, with some changing management companies several times to help obfuscate the actual owners. According to ship-tracking data compiled by Bloomberg they include: 'Russia does have more vessels at its disposal compared to the summer/fall of 2024,' Malte Humpert, founder of the Arctic Institute, a Washington-based think-tank, said in an email. 'If it can find buyers, this small fleet should be sufficient to lift cargoes.' Eight shipments were exported from Arctic LNG 2 between August and October 2024, but never docked on foreign shores. Instead, the gas was offloaded into two Russian storage units in the Barents Sea and its Far East region. Large-scale production halted in October after ice built up around the facility and made transport by traditional vessels challenging. Russia's first domestically built ice-class LNG tanker may come online in the second half of this year if it passes remaining sea trials, Interfax reported Wednesday, citing Sovcomflot Chief Executive Officer Igor Tonkovidov. Now, the market will be closely monitoring whether Arctic LNG 2 can find willing buyers. Exporting more would be a boon for consumers, as it would put pressure on global gas prices. The Biden administration was diligent in sanctioning ships and companies connected with exporting fuel from Arctic LNG 2 last year. It isn't clear if the Trump administration will be as strict, or if the government will slap restrictions on ports that accept the fuel. The threat of retaliation from the US kept buyers at bay last year. Officials related to the Arctic LNG 2 joint venture have never stopped trying to sell the fuel, traveling to potential buyers in India and China over the last year, according to traders with knowledge of the matter. However, it isn't clear if they have been able to secure any sales. 'The biggest obstacle remains finding a buyer and shipping capacity,' Jan-Eric Fahnrich, a senior analyst at Rystad Energy, said by email. 'They will then circle around looking for buyers in Asia and Novatek will offer a discount.' Majority shareholder Novatek PJSC and the operating venture Arctic LNG 2 did not respond to emails seeking comment. Iris, the tanker currently docked at Arctic LNG 2, is a so-called Arc4 vessel, with a reinforced hull that allows it to navigate the shorter Arctic route to Asia when conditions allow in the summer. It is likely that the ship will make the journey, as Asia is home to buyers who may be willing to circumvent western restrictions. 'China would appear to be the most likely candidate, but with consistently declining Chinese demand for the past eight months this won't be an easy task,' said the Arctic Institute's Humpert. 'The fact that more than one million cubic meters of LNG loaded last year remains unsold, and in floating storage, does not bode well for renewed attempts to market additional volumes this summer.' Loading vessels at Arctic LNG 2 could also be necessary to ease brimming gas tanks. Satellite images taken June 25 indicate that two production trains at the facility are flaring, which indicates they could be operating or cooling down equipment. Without steady exports, the plant's storage will quickly fill up, and lack of space was one of the reasons why Arctic LNG 2 stopped large-scale production in October. Meanwhile, traders will wait to see if US or European officials further tighten restrictions on the facility as exports resume. 'Now is the time for increased pressure' on Russia's energy revenues, said Geoffrey Pyatt, distinguished fellow at the Atlantic Council Global Energy Center and a former US assistant secretary of state who helped craft Arctic LNG 2 sanctions under the Biden administration. 'European leaders have expressed new determination to end all imports of Russian gas, making it even more important that the United States maintains our pressure on Novatek.' --With assistance from Anna Shiryaevskaya. More stories like this are available on
Yahoo
30-03-2025
- Business
- Yahoo
Sanctioned Russian tanker firm Sovcomflot's transportation volumes fell 16% in 2024
(Reuters) - Russia's leading tanker group Sovcomflot's saw transportation volumes drop around 16% to 63 million metric tons last year compared to 2023, Russian news agency Interfax reported on Friday, citing the group's CEO Igor Tonkovidov as saying. The United States and the European Union imposed sanctions on state-controlled Sovcomflot and its fleet in 2024 in an effort to reduce Russia's revenue from oil sales that it can use to finance its war in Ukraine. The company's net profit dropped by 55% to $424 million last year. Sovcomflot hopes that the transportation volume of oil, liquefied natural gas (LNG) and petroleum products will stay at the same level this year, Tonkovidov added. Transportation volumes in 2023 stood at 75 million tons. The U.S. added more of Sovcomflot's vessels to its sanctions list this year, restrictions that the company warned would exert increased operational pressure. Sign in to access your portfolio
Reuters
28-03-2025
- Business
- Reuters
Sanctioned Russian tanker firm Sovcomflot's transportation volumes fell 16% in 2024
March 28 (Reuters) - Russia's leading tanker group Sovcomflot's ( opens new tab saw transportation volumes drop around 16% to 63 million metric tons last year compared to 2023, Russian news agency Interfax reported on Friday, citing the group's CEO Igor Tonkovidov as saying. The United States and the European Union imposed sanctions on state-controlled Sovcomflot and its fleet in 2024 in an effort to reduce Russia's revenue from oil sales that it can use to finance its war in Ukraine. The company's net profit dropped by 55% to $424 million last year. Sovcomflot hopes that the transportation volume of oil, liquefied natural gas (LNG) and petroleum products will stay at the same level this year, Tonkovidov added. Transportation volumes in 2023 stood at 75 million tons. The U.S. added more of Sovcomflot's vessels to its sanctions list this year, restrictions that the company warned would exert increased operational pressure.
Bloomberg
27-03-2025
- Business
- Bloomberg
Russia Playing the "Long Game" to Protect Energy Exports
Russia's sanctioned Arctic LNG 2 plant may soon receive its first domestically built ice-class tanker, expanding its fleet as the project anticipates potential easing of Western energy restrictions. The Zvezda shipyard in Russia's Far East is completing construction of several LNG carriers, dubbed the Alexey Kosygin series after their lead tanker, Igor Tonkovidov, chief executive officer for Russia's largest shipping company Sovcomflot, said at a conference in Murmansk. Leslie Palti-Guzman, Senior Associate with a focus on energy security at the Center for Strategic and International Studies, breaks down what she sees as the Kremlin's long-term energy export strategy once the War in Ukraine comes to and end. She also explains why the plan may create an economic conflict between US President Donald Trump and his Russian counterpart, Vladimir Putin. Leslie speaks with Paul Sweeney and Alix Steel on Bloomberg Radio. (Source: Bloomberg)
