CEO: Technip Energies on track to exit Arctic LNG 2 project in first half

Paris-based LNG engineering giant Technip Energies is on track to complete exiting Novatek’s Arctic LNG 2 project in Russia within the first half of 2023, according to the company’s CEO Arnaud Pieton.

Pieton said in October last year that the company had signed a deal to exit the Arctic LNG 2 project.

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

Novatek is still expecting to launch the first GBS by the end of this year, despite Western sanctions on Russia and Russian firms.

“So, on Arctic LNG 2, yes, we are on track to execute the full exit as we had previously communicated within H1 2023,” Pieton told analysts during the Technip Energies first-quarter earnings conference call on May 4.

“Therefore, within this quarter, everything is on track. A lot of hard work by all the teams, but happy to report that so far everything looks favorable for delivering as per what we had indicated previously,” he said.

The company’s adjusted revenues were down 13 percent year-over-year in the first quarter to 1.4 billion euros ($1.54 billion), impacted by the maturity of the project delivery portfolio and the ongoing exit from the Arctic LNG 2 contract.

LNG contracts

In March, Pieton said that Technip Energies was working on up to ten LNG FEED contracts and the company expects to secure new EPC deals this year.

During the first quarter, Technip Energies has won a contract from Shaanxi LNG Reserves & Logistics for the Xi’An LNG emergency reserve and peak regulation project in China.

Technip Energies said the “significant” contract for the 3 million normal cubic meters per day facility is worth between 50 million euros and 250 million euros ($55 million-$276 million).

Pieton said during the first-quarter call that the the commercial pipeline for Technip Energies “continues to be extremely robust and vast.”

“So, Middle East continues to be, I would say, an area of focus and for LNG and other gas projects,” Pieton said.

Technip and Chiyoda previously won the EPC award for QatarEnergy’s North Field East project which includes building four “mega trains” with a capacity of 8 million tonnes per year in the Ras Laffan complex.

This first phase of the expansion project will increase Qatar’s LNG production capacity from 77 to 110 Mtpa, while QatarEnergy is also working on the second phase, the 16 Mtpa North Field South (NFS) LNG project, which will further boost capacity to total 126 Mtpa.

Technip Energies is also bidding for the NFS contract.

Citing media reports, an analyst asked whether Technip Energies had submitted the best proposal for the NFS project.

“NFS is a very important prospect for us because LNG continues to be part of our equity story, and we continue to believe in LNG. Considering, I would say, the nature of the prospects and where we are, I’d rather not comment further on what has been published in the press, which may or may not be accurate,” Pieton said.

“If you want to continue into LNG, East Africa has potential in LNG for 2023.. And I would say North America also continues to be attractive,” he said.

“And we’ve seen clients, I mean, getting closer to potential FID 2023 in the space of LNG. So, we are extremely active bidding,” Pieton said.

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