NOVATEK Will Use Its Own Gas in a New LNG Project
NOVATEK’s new liquefied natural gas (LNG) project in the Murmansk region, consisting of three lines with a capacity of 6.8 million tons each, which became known at the end of May, will use gas from the company itself, and not from Gazprom. Leonid Mikhelson, the largest co-owner and chairman of the board of NOVATEK, stated this at a briefing at the St. Petersburg International Economic Forum, RBC correspondent reports.
“This will be our resource base,” Mikhelson said, answering a question about raw materials for the new plant. According to him, NOVATEK, which in 2022 increased production by 2.75%, to 82.1 billion cubic meters. m of gas, there will be enough gas reserves to continue deliveries to the Russian market, and additional volumes due to new fields in the south of the Gydan Peninsula should be sent for liquefaction at Murmansk LNG. “With the existing resource base, we can maintain a shelf [of production] until 2040, excluding the Gydan deposits. Therefore, we can raise production to the volumes required for Murmansk LNG. In five to seven years, we will connect new fields, while the shelf for supplies to the domestic market of Russia will remain the same,” he explained.
According to the head of NOVATEK, one liquefaction line at Murmansk LNG requires 11 billion cubic meters. m per year, for all three lines – about 30 billion cubic meters. m. It is assumed that the first line of the plant will start operating in 2027.
The difference between Murmanskoye LNG and other LNG plants launched in Russia is that it will be built far from gas fields, so it will receive gas from the Unified Gas Supply System (UGSS) owned by Gazprom. The Kommersant newspaper, which first wrote about this NOVATEK project, claimed that the company, unlike Gazprom, now does not have free production capacity of 30 billion cubic meters. m of gas in the ESG zone. Therefore, she assumed that NOVATEK would buy gas from Gazprom. Mikhelson, in fact, denied this, noting that by the time the plant was launched, the company would have enough of its own production.
Making an investment decision on Murmansk LNG will also require the construction of the Volkhov-Murmansk gas pipeline with a length of 1.4 thousand km, which will connect the project with the UGSS, from where it will receive raw materials, Mikhelson said earlier. At a briefing during the St. Petersburg International Economic Forum, he noted that NOVATEK intends to independently build this gas pipeline. “We will build the gas pipeline to Murmansk LNG ourselves. The main pre-design work has already been done,” he said. The pipe will have a capacity of 30 billion cubic meters. m per year, which is enough to load three lines of the plant.
On May 30, NOVATEK’s press service told Kommersant that for the construction of this gas pipeline, the company expects technical conditions from Gazprom for connection to the Unified Gas Supply System. Since then, Gazprom has not commented on this request. RBC sent questions to a representative of the gas monopoly.
