Envoy: Japan may increase Russian LNG purchases

Russian Consul General in Sapporo (Japan) Sergey Marin has said that Japan has not withdrawn from the Arctic LNG-2 project, but the country has frozen new investments in it since March 2022 due to sanctions.

According to Marin, "if all goes according to plan", Japan will increase its purchases of Russian liquefied natural gas by 2 million tonnes per year, a 9 per cent increase, by 2026.

"A consortium made up of Mitsui & Co and Japanese national oil and metals company JOGMEC retained a 10 per cent stake in Novatek's Arctic LNG-2 project. With the only clarification that Japan has frozen new investments in this project since last March because of financial sanctions," Marin told Kommersant.

The consul general noted that Arctic LNG-2 is operational, but the production of liquefied natural gas has not yet started.

"The first line should be up and running by the end of this year and the second and third lines in 2024 and 2026. If all goes according to plan, Japan will add about 2 million tonnes of LNG per year more to the share it currently receives from Russia, which is about 9 per cent of its total imports," he added.

"Arctic LNG-2 is a $21.3 billion project of Novatek. It involves the construction of three LNG production stages on the Gydan Peninsula, each with a capacity of 6.6 million tonnes per year. At the end of 2021, the overall readiness of the project was estimated at 59 billion, while the progress of the first stage was 78 per cent,’ he added.

In late March last year, Nikkei, citing sources, reported that Japan had frozen new investment in Arctic LNG-2 because sanctions were preventing remittances from banks.