Russia will repeat success of first Arctic gas plant

Subject

Russia's Arctic gas plans.

Significance

Chinese assistance has enabled Russia to build new expertise in liquefied natural gas (LNG) production under Arctic conditions, making it possible and less costly to repeat the exercise. The Novatek company's Yamal peninsula operation has pushed the boundaries of hydrocarbons development under Western sanctions and paved the way for a second project, Arctic LNG-2.

Impacts

• Novatek's reputation as a major export company that delivers on project pledges is now assured.
• Arctic gas extraction underlines the region's strategic value, including as a maritime route.
• Gazprom is supposed to add a second liquefaction unit at its Sakhalin plant; failure to do so will erode its political standing.
• Rosneft will add to the competition with a gas pipeline from Iraqi Kurdistan.