Novatek finalizes Arctic LNG 2 supply deal with China’s Zhejiang Energy

Russia’s Novatek said on Tuesday it signed a deal with Zhejiang Energy Gas Group to supply the Chinese firm with liquefied natural gas from its Arctic LNG 2 project.

The SPA follows the heads of agreement the duo signed in June last year.

Under the deal, Novatek’s gas and power unit would deliver 1 million tons of LNG on a DES basis for a period of 15 years to Zhejiang Energy’s LNG terminals in China, Novatek said.

Zhejiang Energy is a unit of the Zhejiang Provincial Energy Group.

The Arctic LNG 2 project located on the Gydan peninsula includes the construction of three trains with a capacity of 6.6 mtpa, each, using gravity-based structure platforms.

Novatek plans to launch the first GBS in 2023, followed by the second in 2024, and the third in 2025.

The Russian firm is the LNG project’s operator with a 60 percent stake, France’s TotalEnergies owns 10 percent while CNPC and CNOOC of China also have 10 percent, each.

Furthermore, Japan Arctic LNG, a consortium of Mitsui & Co and Jogmec owns a 10 percent stake in the project as well.

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