Arctic LNG 2 project at 73% completion as of end of 2022, first stage at 95% readiness

MOSCOW. April 3 (Interfax) - The overall progress of the Arctic LNG 2 project stood at 73% as of the end of 2022, and completion of the first stage was 95%, Novatek said in the company's reporting.

The installation of all 14 LNG plant topsides modules and hydrotesting of the GBS (gravity-based structures) for the first phase of the Arctic LNG 2 project has been completed at the SCC (Superfacility Construction Center) in the Murmansk Region; work is underway to integrate the topsides modules and the GBS, and to transfer the completed module and GBS systems to pre-commissioning.

Concrete work has been completed on the second-stage GBS platform, and mechanical equipment work is underway. In October 2022, the first 2 modules of the second stage of the LNG plant arrived in Murmansk.

As of the end of 2022, a total of 79 wells had been drilled at the Utrenneye field, including 23 wells in 2022. The well stock drilled provides production potential for the launch of the first phase of the project. As of the end of 2022, production drilling was being carried out by five drilling rigs.

All three sections of the Utrenneye terminal waterfront for the project's three GBS have been commissioned. One of the quay sections is currently being used to receive materials and equipment. Construction of ice protection structures will be completed by the end of 2022.

The construction and commissioning of all facilities of the GBS complex site and modules of the overhead structures of the SCC has been completed. These facilities are in operation, and the modules of the 2nd and 3rd process lines of the LNG plant are being consolidated. The world's largest "floating gate" - 200 m long, 20 m wide and high, has been built as a part of the dry dock. The floating gate has been tested and is fully ready for operation (taking the GBS out of the dock).

In February, an ice-rated Arc7 AUDAX vessel undertook a unique ultra-late voyage along the Northern Sea Route (NSR) to deliver a technological module weighing almost 12,000 tonnes for the Arctic LNG 2 project from the Chinese port of Tianjin to Murmansk.

"NOVATEK also reported that it has completed the main construction and installation works and started the commissioning (individual testing of equipment and hydraulic testing of pipelines) on a project for construction of a hydrocracking unit for heavy residue (fuel oil) with the accompanying expansion of production capacity at the plant in Ust-Luga. The launch of the unit will increase the depth of processing of stable gas condensate into lighter petroleum products with higher added value.

In early February, Novatek chief Leonid Mikhelson promised that the plant would be launched in the next 2-3 months.

The $21.3 billion Arctic LNG 2 project envisages constructing three LNG liquefaction trains of 6.6 million tonnes per annum each, each installed on a gravity-based structure. The GBS will be towed from Murmansk to the Yamal-Nenets Autonomous District where they will be used in close proximity to the Salmanovskoye field, the project's resource base.

Novatek owns 60% in the Arctic LNG 2 project, with the remaining shareholders of France's TotalEnergies , China's National Petroleum Corporation (CNPC) and CNOOC, as well as a consortium of Japan's Mitsui and JOGMEC owning 10% each.