Technip Energies’ exit from the Arctic LNG 2 project in Russia is due to complete in a few months, according to chief executive Arnaud Pieton.

“In line with the applicable sanctions, we continue to implement an orderly exit from the project,” he said while unveiling the contractor’s second-quarter results which saw revenues and net income hold steady at about €1.65 billion ($1.67 billion) and €59 million, respectively, compared with a year earlier.

“We have suspended the vast majority of the work [on Arctic LNG 2] and the exit process will likely take several more months due to the contract terms and the inherent size of the project.”

Pieton confirmed the company does not expect “any negative net financial exposure due to our contractual rights and the balance sheet position of the project”.

During the first half of 2022, about €2 billion relating to the liquefied natural gas project was removed from Technip Energies’ adjusted backlog, with €846.6 million associated with the development remaining in the backlog as at 30 June.

Commenting on the broader energy market, Pieton said that first half of 2022 revenue growth “was consistent with our full year financial framework and we expect our activity outside of Russia to demonstrate further growth in the second half”.

He noted that “strong execution of our quality backlog is driving profitability above our original guidance, leading to an increase in our full year margin outlook”.

Pieton noted a pick-up in activity in the carbon capture and storage sector which reflects “a maturing of our broader energy transition pipeline [and] we expect to reach around €1 billion of energy transition orders, excluding LNG, by the end of 2022”, a doubling of the current order book with the added benefit of being the company’s highest margin business.

“Energy market fundamentals, notably for natural gas, LNG, and renewables remain robust,” he said, “supporting our strategic offering and medium-term order outlook. Despite ongoing recessionary fears, a significant increase in energy infrastructure investment will be required to satisfy demand and meet energy independence goals.”

Pieton added: “The transition to a low-carbon energy system requires innovation, technology and technical expertise, opening a new golden age for engineering.”

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