GLNG: Russia’s Novatek seeks to gain foothold in China’s LNG market

Russian state-run LNG developer Novatek has offered part of an LNG cargo to China as its new China marketing arm pushes to break into China’s massive domestic gas market, Reuters reported on July 10.

Novatek’s China marketing team, which was established in Beijing in February, is believed to be offering about 15,000 tonnes of the super-cooled gas to Chinese firms, sources told Reuters.

The available LNG is part of a cargo being shipped from Novatek’s Yamal LNG facility located in Sabetta in northwest Siberia. The majority of the shipment, approximately 60,000 tonnes, has been purchased by Beijing Gas Group sources told Reuters, adding that the gas was acquired via an intermediary in a domestic trade.

With the US announcing sanctions against Novatek’s Arctic LNG 2 in November, which effectively forced foreign backers of Arctic LNG 2, such as TotalEnergies and Japan’s Mitsui and JOGMEC to declare force majeure and exit the project, Russia’s largest LNG exporter countered by founding a Beijing-based marketing and business team in February. As well, Novatek setup a Shanghai trading unit and also a shipping arm.