The agreement signed by the two companies during the Saint Petersburg Economic Forum includes the CNPC’s acquisition of a key stake in the project and a Chinese commitment to buy an annual 3 million tons of Russian LNG, as well as joint efforts in recruiting additional Chinese investors to the project.
Commenting on the deal, Novatek CEO Leonid Mikhelson says that the cooperation between the companies is “an important step in the development of the Yamal LNG project”.
“With the CNPC, we get not only a reliable partner, which has rich experiences from participation in international LNG projects, but also a reliable and long-term buyer and representative of one of the world’s most intensively developing gas markets”, he adds in a press release.
From before, the French energy company Total has a 20 percent of the project. Novatek is reportedly also interested in getting an additional third partner for a nine percent stake.
When fully developed, the Yamal LNG project will produce an annual of 16,5 million tons of LNG, most of it to be out-transported along the Northern Sea Route. The source of the gas is the South-Tambey field with an estimated 1,9 trillion cubic meters. The project is to be up and running by 2016.
The Yamal LNG will be connected with the Sabetta port, a new key infrastructure object in the Russian Arctic. As previously reported, the Sabetta port will be able to handle more than 30 million tons of goods per year. The new port is planned to be operational all-year-round, despite the highly complex ice conditions of the Ob Bay.
The state-owned CNPC is the largest integrated energy company in China.