Russia’s Arctic LNG 2 secures loans worth about $10.8 billion

Russia’s Novatek and its partners in the Arctic LNG 2 project have signed loan agreements with international financial institutions and commercial banks.

Under the loans, Russian and international banks would provide about 9.5 billion euros ($10.8 billion) for up to 15 years, Novatek said in a statement on Tuesday.

The external financing package with a consortium of international and Russian banks secures the required external funding for the project, the firm said.

Moreover, the Chinese financial institutions, including the China Development Bank and the Export-Import Bank of China, signed credit facility agreements totaling up to 2.5 billion euros ($2.84 billion).

The financial institutions from the Organisation for Economic Co-operation and Development (OECD) member countries signed credit facility agreements totaling up to 2.5 billion euros, including the Japan Bank for International Cooperation (JBIC) and other lenders insured by export credit agencies.

Also, the syndicate of Russian banks including PJSC Sberbank, Gazprombank and its subsidiary Bank GPB International, state development corporation VEB.RF and Bank Otkritie Financial Corporation would provide in total 4.5 billion euros under the credit facility agreement signed earlier, Novatek said.

Novatek has previously said the project’s partners were working to complete about $11 billion in external financing for the project that will cost around $21.3 billion in total.

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

Novatek recently welcomed the project’s first modules from China. It expects to launch the project’s first LNG train in 2023, with trains 2 and 3 to follow in 2024 and 2025, respectively.

Besides operator Novatek, the project partners include TotalEnergies, CNPC, CNOOC, and the consortium of Mitsui and JOGMEC.

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