Russia's Novatek concluded a 20-year LNG sales and purchase deal covering 19.8 million tonnes per year with partners in the Arctic LNG-2 project, the company announced on Wednesday.
The LNG sales from the Arctic LNG 2’s first liquefaction train are due to commence in 2023.
The LNG offtake volumes are set in proportion to the respective participants' ownership stakes in the project.
'The long-term offtake agreements between Arctic LNG 2 and its participants ensure the future revenue stream from LNG sales and de-risks the project,' noted Leonid Mikhelson, Novatek's chairman.
'This represents one of the most important milestones in attracting the project’s external financing that will be completed in 2021,' he said.
The Arctic LNG 2 project envisages constructing three LNG liquefaction trains each of 6.6 million tonnes per annum, as well as a cumulative gas condensate production capacity of 1.6 million tonnes per annum.
The total LNG capacity of the three liquefaction trains will be 19.8 million tonnes.
The project’s participants include Novatek with a 60% majority share, and Total, CNPC, CNOOC Limited, and the Japan Arctic LNG consortium of Mitsui & Co. Ltd. and JOGMEC all with 10% shares each.
By Murat Temizer