Putin’s Gas Failure: Russia’s Largest LNG Project Left Without ‘Ice’ Tankers

Sanctions are working.

Oligarchs Leonid Mikhelson and Gennady Timchenko, close to the Russian dictator, are facing a serious problem with their multi-billion dollar Arctic LNG 2 project for the production of liquefied natural gas (LNG). It was left without ice-class tankers.

This was reported by dialog.ua with reference to the American publication Bloomberg.

According to journalists, the sanctions noose is tightening more and more around Arctic LNG 2. The project was virtually paralyzed, and therefore in the autumn of 2023 it was forced to declare force majeure. Major problems have arisen, in particular, with ice-class tankers, without which it is impossible to transport LNG in the extreme conditions of northern latitudes.

The Japanese company Mitsui OSK Lines (MOL), which was supposed to provide transportation of liquefied gas to the Russian Federation, completely stopped all cooperation with the project due to sanctions. Today it can neither receive the ordered tankers nor sell them to the Russians.

“According to the contract, if we cannot provide a service to the project, we are obliged to sell our ships to it. But due to sanctions, this deal is impossible,” said MOL head Takeshi Hashimoto.

He emphasized that the situation with the project was very difficult.

Arctic LNG 2 is a project of the Russian company Novatek for the extraction and production of LNG on the Gydan Peninsula on the outskirts of the Arctic Ocean. The total production capacity of liquefied gas is almost 20 million tons, and the capitalization of the project is almost 16 billion rubles.

As for Novatek, it belongs to the oligarchs Mikhelson and Timchenko, who are considered the closest circle of Russian dictator Vladimir Putin.