Sale of 10% of Arctic LNG to Nordline to be completed soon - TotalEnergies CEO
MOSCOW. July 23 (Interfax) - France's TotalEnergies wrote off $4.1 billion in Russian assets in 2022, primarily in Arctic LNG 2 shares, however, Novatek , which owns 60% of the LNG project, has initiated the process of transferring these shares, TotalEnergies CEO Patrick Pouyanne said during a conference call with investors.
"Novatek has initiated discussions about transferring 10% of Arctic LNG 2 to one of its subsidiaries, Nordline, and the Russian president has approved this. [...] We expect the transfer process initiated by Novatek to be completed in the near future," Pouyanne said.
As reported, President Vladimir Putin signed an order in early June authorizing Nordline LLC to purchase 10% of Arctic LNG 2 from a subsidiary of TotalEnergies. The corresponding document was posted on the portal of legal information.
The document does not indicate the identifiers of the buyer company, other than its name. In May this year, Novatek, which owns 60% of Arctic LNG 2, created a 100% subsidiary named Nordline LLC.
The Arctic LNG 2 project involves three liquefied natural gas trains, with an annual capacity of 6.6 million tonnes each. The first train was launched in 2024.
The U.S. imposed sanctions on Arctic LNG 2 in November 2023. It was reported in mid-December 2023 that Novatek had invoked the force majeure clause for deliveries to some customers due to U.S. sanctions. Interfax sources linked this to fears expressed by banks and shipowners about the possible risk of providing financial and transportation services due to the sanctions against the project. The sources said that Novatek had taken a break in order to resolve the problem, invoking force majeure and thus eliminating the risk of fines if deliveries are delayed. Newspaper Kommersant said, citing Russian government sources, that the foreign shareholders of Arctic LNG 2 - TotalEnergies, China's CNPC and CNOOC and the consortium of Japanese Mitsui and JOGMEC, each of which hold a 10% share, had also involved the force majeure clause for their contracts in the project due to the U.S. sanctions.
TotalEnergies confirmed that it would not be receiving LNG from the project in 2024 due to the force majeure announced after the project was hit by U.S. sanctions.
Novatek holds a 60% share in Arctic LNG 2. Each of the remaining shareholders - TotalEnergies, China's CNPC and CNOOC and the consortium of Japanese Mitsui and JOGMEC - own 10% each.
