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Total, Novatek and partners approve Arctic LNG 2 FID

Sep 05, 2019
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Total, Novatek and the other project shareholders have approved the final investment decision (FID) for Arctic LNG 2, a major liquefied natural gas (LNG) development located on the Gydan peninsula, Russia.

The project will have a production capacity of 19.8 million tons per year (Mt/y) and is expected to export its first LNG cargo by 2023, the second and third train to start up by 2024 and 2026.

Total has a direct 10 per cent interest in Arctic LNG 2 alongside Novatek (60 per cent), CNOOC (10 per cent), CNPC (10 per cent) and a Mitsui-Jogmec consortium, Japan Arctic LNG (10 per cent).

Total also owns an 11.6 per cent indirect participation in the project through its 19.4 per cent stake in Novatek, thus an aggregated economic interest of 21.6 per cent in the project.

“Arctic LNG 2 will leverage the success of the Yamal LNG project and will deliver competitive

LNG to the markets in four years’ time," said Patrick Pouyanné, chairman and CEO of

Total.

“Arctic LNG 2 adds to our growing portfolio of competitive LNG developments based on giant low cost resources primarily intended for the fast growing Asian markets.”

The project has very low upstream costs with the development of the giant resources from the Utrenneye onshore gas and condensate field. The installation of three concrete gravity-based structures in the Gulf of Ob on each of which will be located a 6.6 Mt/y liquefaction train will contribute to significant capex reduction (more than 30 per cent per ton of LNG) compared to Yamal

LNG. Also, the close proximity to Yamal LNG will allow Arctic LNG 2 to leverage synergies with existing infrastructure and logistics facilities.

Arctic LNG 2 production will be delivered to international markets by a fleet of ice-class LNG carriers that will be able to use the Northern Sea Route and the trans-shipment terminal in Kamchatka for cargoes destined for Asia and the transshipment terminal close to Murmansk for cargoes destined for Europe.

Total, second largest private global LNG player

Total is the second-largest private global LNG player, with an overall portfolio of around 40

Mtpa by 2020 and a worldwide market share of 10 per cent. With 22 Mt of LNG sold in 2018, the

Group has solid and diversified positions across the LNG value chain.

Through its stakes in liquefaction plants located in Qatar, Nigeria, Russia, Norway, Oman, Egypt, the United Arab Emirates, the United States, Australia or Angola, the Group sells LNG in all markets.

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