Another Arctic LNG 2 loading but still no deliveries

A FOURTH liquefied natural gas vessel has loaded a cargo from Russia’s sanctioned Arctic LNG 2 plant, but with no clear indication where any of the cargoes are heading.

The former Sovcomflot Arc7 LNG tanker Christophe De Margerie(IMO: 9737187) arrived unloaded at Arctic LNG 2 on August 9, and remained at the terminal on Monday.

The arrival of Christophe De Margerie is the fourth such loading since the end of June at the heavily sanctioned Russian Arctic LNG project. However, each of the previous three shipments are yet to find a buyer.

Three sanctioned vessels, Iris(IMO: 9953523), Voskhod(IMO: 9953511) and Zarya(IMO: 9953535), had previously loaded cargoes from Arctic LNG 2, but then moved to anchoring positions in Russian waters.

With the northern sea route now open and navigable, there are no physical restrictions on the cargoes moving, but even with sizable discounts to the gas, sanctions are putting off buyers in Asia.

The US directly sanctioned Arctic LNG 2, a project publicly backed by Vladimir Putin and thought to have cost in the region of $25bn to construct, in a bid to ensure that the project would be rendered “dead in the water”.

Arctic LNG 2 was set to become one of the country’s largest LNG plants, with eventual output of 19.8m tonnes a year.

While power units have been delivered into critical gravity-based platforms, best-guess estimates from analysts suggest they have at best half capacity on each train. While that represents an estimated potential 6.6m tonnes a year in potential output, sanctions continue to disrupt operations.

Christophe De Margerie, which has been sanctioned by both the EU and US since last year, previously served Yamal LNG, Russia’s biggest export facility for the fuel, which also operates in the Arctic region. That facility is also led by operators of the Arctic 2 LNG project, Novatek, but is not subject to direct sanctions.

The loading at Arctic 2 LNG marks a return to active service for the vessel which had been at a Chinese repair yard before returning to Russia via the Northern Sea Route in November.

Market rumours had suggested that sanctions and lack of access to European expertise had affected the repairs thanks to critical parts for the 2016-built LNG tanker being unavailable.