TotalEnergies Completes Transfer of 10% Stake in Russia's Arctic LNG 2 Project

en.Wedoany.com Reported - On August 27, TotalEnergies confirmed the completion of the transfer of its 10% interest in the Arctic LNG 2 project to NordLine, a subsidiary of Novatek. Following the transaction, TotalEnergies is no longer a shareholder in the Arctic LNG 2 project.

Under the transfer agreement, TotalEnergies retains the right to require Arctic LNG 2 to repay its corresponding shareholder loans, amounting to approximately $1.3 billion. The company stated that the future repayment of these amounts depends on the sanctions regulations applicable at that time. This announcement did not disclose the equity transfer price or the loan repayment schedule.

Arctic LNG 2 is located on the Gydan Peninsula in the Yamalo-Nenets Autonomous Okrug of Russia, with the Utrenneye gas field as its resource base. OOO Arctic LNG 2 serves as the project operator and holds the project assets and the LNG export license. The project plans to build three LNG production trains with an annual capacity of 6.6 million tons each, with a total designed capacity of 19.8 million tons per year, alongside a stable condensate production capacity of up to 1.6 million tons per year.

Following the completion of the equity introduction among project participants in 2019, Novatek held 60%, while TotalEnergies, CNPC, CNOOC, and Japan Arctic LNG—a consortium of Mitsui & Co. and JOGMEC—each held 10%. The project reached its final investment decision in September 2019, with capital expenditure for full commissioning estimated at approximately $21.3 billion at the time.

TotalEnergies ceased booking Arctic LNG 2-related resources in its proved reserves starting at the end of 2021. In 2022, as LNG technology and financial sanctions affected project execution, the company recorded impairments on its Russian assets, including Arctic LNG 2, with impairments related to Russian assets totaling approximately $4.1 billion as of March 31, 2022. TotalEnergies subsequently retained its 10% direct interest in Arctic LNG 2 until the completion of this transfer.