News Post
Russia's Gazprom delays Baltic, Sakhalin LNG projects
MOSCOW (Reuters) -- Russia's Gazprom has delayed LNG plans on Sakhalin island and in the Baltic Sea, a Eurobond presentation showed on Monday.
The delays could disrupt Russia's plans to carve out a bigger share of the global LNG market, where it aims to triple its market share of less than 5% by 2035.
Gazprom plans to expand the Sakhalin-2 project off Russia's Pacific coast by 2023-2024, the presentation showed, while previously it had announced plans to launch a third LNG production train there in 2021.
The presentation seen by Reuters showed a 2022-23 launch for a new Baltic LNG plant in the Leningrad region, later than the 2021 start aimed for in a June 2016 memorandum of understanding.
Sakhalin-2 is currently Russia's only LNG plant. It operates two production lines with a combined capacity of 10 MMt of LNG per year.
"We expect to commission the third LNG production line at the Sakhalin LNG plant in the period from 2023 through 2024," Gazprom's prospectus for the Eurobond issue said.
The third train is expected to boost production by 5.4 MMtpy.
The plans to expand the plant have been long considered by the shareholders but where hampered by issues related to the gas resources.
Shareholders are considering two options: buying gas from the Sakhalin-1 project led by ExxonMobil, developing new resources or a combination of the two.
Yet, Sakhalin-1, where Russian state-controlled oil major Rosneft is also a shareholder, aims to have its own LNG plant.
Gazprom, the world's top conventional gas producer, has mandated banks to arrange investor meetings in the United States this week, Thomson Reuters news and market analysis service IFR said last Wednesday.
IFR said a US dollar denominated Eurobond of a benchmark size may follow the roadshow, set for March 13 in Los Angeles and March 14 in New York.
Reporting by Vladimir Soldatkin and Oksana Kobzeva; Editing by Jason Neely
For subscriptions or a demo:
Sam Hassaniyeh
Subscription Executive
Phone: +44 203 4092242
For questions or to give feedback:
Thad Pittman
Senior Researcher
Phone: +1 (713) 525-4605
Download our brochure today!
Project News