Novatek, Russia’s largest independent natural gas producer and leading developer of Arctic liquefied natural gas (LNG), gears up from European partners to new company in United Arab Emirates (UAE) is shifting.
According to an industry report, Novatek hopes its new Emirati firm, Green Energy Solutions, will be able to secure the technology its former Western partners were meant to offer.
Many Western companies, such as Technip in France, Saipem in Italy and Baker Hughes in the United States, Withdrawal from Novatek’s Arctic project As a result of Western sanctions.
The implementation of economic sanctions after Russia’s invasion of Ukraine Significant impact on Novatec’s business.
Imports of Russian LNG into the EU are still permitted, but the financing and export of key technology to build new LNG projects, including in the Arctic, is prohibited.
Novatek is looking for new international partners Outside EU sanctions to secure much-needed Western technology to complete the Arctic LNG 2 project.
According to trade magazine intelligence onlineNovatek staff at the central construction yard near Murmansk were informed that all issues related to the technology, previously provided by Technip and Saipem, now flow through the emirate company.
“Because Green Energy Solutions is a resident of the UAE, it is not subject to EU sanctions and can purchase and supply equipment for projects,” said a Moscow-based company specializing in international business and corporate law. Law firm partner Alexander Kukuev explained. .
Arctic projects despite sanctions
Novatek’s flagship Arctic LNG 2 project, which consists of three production lines, faces significant delays as a result of Western sanctions.
According to the company, The first production line will not open until the end of 2023 One year behind schedule at the earliest. The whereabouts of his two remaining lines remain unknown.
In recent months, Novatek has announced an attempt to redesign the liquefaction process as much as possible.
this Contract with floating power plant in Turkey This is so that the limited number of specialized turbines received before the sanctions took effect can be used for gas liquefaction rather than electricity production.
But industry experts don’t believe these efforts will be enough to complete a second or third production line.
Novatek’s unique method for liquefaction of natural gas isarctic cascade,” is reported to have failed.
2021 The company has canceled an attempt to use it on the Ob LNG project Instead, it said it would rely on Germany’s Linde to procure the necessary compressors and other equipment.
Novatek’s goal is to work with new Emirati companies to circumvent sanctions regimes and discreetly source needed technology.
A new Emirati company, Green Energy Solutions Project Management Services, was newly registered in Abu Dhabi in June and has established itself as an engineering, project management and construction consultancy.
Novatec at the same time Started recruiting staff For unspecified duties based in the UAE, including Chief Accountant and Project Manager.
“It is noteworthy that the entity was set up in Abu Dhabi rather than Dubai, which suggests that it has the support or patronage of local elites. promoted by the local elite [President of the UAE] This is a strategic asset that requires approval, so we need to get support.
closer relationship
The close relationship between the UAE and Russia’s Novatek follows many cooperations and investments that link the two countries. Mubadala, an Emirati sovereign wealth fund, invests a portion of its portfolio in Russian direct investment funds.
Mubadala in December 2021 Acquired 1.9% stake in SiburNovatek is a Russian petrochemical company partly owned by the CEO and Chairman of the Board.
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