Long term contracts set to commence in 2018
From LNG World Shipping
Russian president Vladimir Putin launched the first shipment of liquified natural gas from the new Yamal LNG facility located in the Russian Arctic.
The LNG plant sold an initial cargo of 170,000 m3 to LNG shipping, trading and distribution specialist Petronas, in the UK.
The Russian leader commented on the technical complexity of the project in extensive remarks at the event.
“This is certainly a complex project, and we have good people here in this room, good professionals, who warned me at the beginning of this journey: ‘Do not do this,’” he said.
“When asked why – the first, second, third – the reasons they cited were all really serious. But those who started this project took the risk, and the risk proved to be justified, and they achieved success.”
The US$27Bn plant began operations on 5 December in Sabetta on the Yamal peninsula. It was jointly financed by Russian gas company Novatek, France’s Total and the China National Petroleum Corporation.
US sanctions against Novatek subsidiaries were a significant hurdle for project’s financing. They came as part of a response to Russia’s annexation of the Crimean Peninsula in 2014.
President Putin made oblique references to the financing difficulties surrounding the project in his speech, saying “I would like to thank our foreign friends and foreign partners (many of them are with us in this room), because without their help, without their trust in their Russian friends and partners, this project would not have happened either. I am referring to both financing and technologies. The project involved companies from the East, from Europe, all of them took an active part in it. And today’s shipping, the first shipment, is our common victory.”
In a Novatek statement, chairman Leonid Mikhelson said “This event begins the process of developing and liquefying our massive natural gas resources on the Yamal and Gydan peninsulas into more than 70M tonnes of LNG. This potential gives our country an opportunity to become one of the biggest global LNG exporters.”
From 2019, the Yamal project will have a projected capacity of 16.5M tonnes per year of LNG, with the facility expected to produce 5.5M tonnes in 2018. Long-term sales contracts are set to commence in April 2018, according to a statement from Novatek, with sales before April handled on a spot basis by Yamal LNG shareholders.
Sovcomflot’s Arc7 ice-classed tanker Christophe de Margerie took the first shipment of cold fuel from Yamal.
Teekay LNG Secures Financing for Yamal ARC7 LNG Carriers
From LNG Industry
Teekay LNG Partners L.P. has announced the completion of an US$816 million long term debt facility to finance all six of the partnership’s 50% owned ARC7 LNG carrier newbuildings.
The first vessel is scheduled to deliver in January 2018, and the remaining vessels through to early 2020. These newbuildings will service the Yamal LNG project under charter contracts with firm charter periods out to 2045 plus option periods.
“Together with our joint venture partner, China LNG Shipping, we are pleased to announce this significant project milestone for our ARC7 LNG carrier newbuildings for the Yamal LNG project, which has successfully commenced producing LNG at the first train and recently completed its first LNG cargo loading,” commented Brody Speers, FO of Teekay Gas Group Ltd.
“With the long-term financing for all six of our 50% owned ARC7 vessels now in place, we look forward to the expected delivery and charter contract commencement of our first ARC7 LNG carrier newbuilding in January 2018. With the completion of this ARC7 financing, the partnership has now completed US$2.2 billion in debt financings for our newbuildings in the past 12 months and has financed 14 of its remaining 15 LNG carrier newbuildings, which includes one FSU.”
