Novatek CEO: first Yamal LNG cargo on track

Novatek’s giant Yamal project in Russia is on track to ship its first cargo of LNG by the end of next year with the project’s plant around 85 percent complete, according to Novatek’s CEO Leonid Mikhelson. 

“Overall, the project is around 68 percent complete now and the first stage [the liquefied natural gas production plant] is around 85 percent complete,” Mikhelson told Russian President Vladimir Putin during a meeting on Monday.

“We plan to bring the plant on line at the end of 2017,”  Mikhelson said.

According to Novatek’s CEO, there are now more than 22,000 people working in Sabetta where the LNG project is located.

“We estimate the total volume of orders around Russia at approximately 580 billion rubles. Some 650 companies are engaged in fulfilling these orders and this, we estimate, represents around 60,000 jobs.”

He confirmed that the US$27 billion LNG project is now fully financed. “The shareholders financed $13 billion, we received $4 billion in rubles from Russian banks, and we have $12 billion from Chinese banks,” he said during the meeting.

The first reservoirs needed for the project’s first stage will be ready for operation in the first quarter of 2016, Mikheslon said, adding that first stage of the electric power plant is expected to be ready for launch at the end of the same year.

He stressed that almost all of the volumes, or 16.5 mtpa of LNG from the Yamal project has already been contracted.

“We have contracts signed for nearly the entire volume – 96 percent – of the future LNG production. The first tanker, which we have named Christophe de Margerie, is going through its first tests now. The project is progressing very well,” Mikhelson said.

Shareholders in the Yamal LNG project are Novatek, as the operator with a 50.1 percent stake, CNPC and Total with 20 percent stake each and China’s Silk Road Fund with a 9.9 percent stake.

LNG World News Staff