TotalEnergies has taken a sizeable stake in a Novatek subsidiary that is building two liquefied natural gas transshipment terminals in Russia, where the French supermajor is already a significant player.

The two companies have also signed a pact that envisages the pair working to slash carbon emissions at their joint LNG projects, with hydrogen production, renewable energy use as well as carbon capture and storage technologies on the menu.


Gain valuable insight into the global oil and gas industry's energy transition from ACCELERATE, the free weekly newsletter from Upstream and Recharge. Sign up here today.

TotalEnergies — which last week changed name from Total — is taking a 10% stake in Arctic Transshipment, wholly owned by Russian gas independent Novatek.

Arctic Transshipment owns and operates two LNG transshipment terminals that are being built in the Kamchatka and Murmansk regions.

They will provide export logistics services, including to the Novatek-led Arctic LNG 2 project that is currently under development and is set to commission its first cargo in 2023.

TotalEnergies already has a 10% stake in Arctic LNG 2, as well as a 20% interest in Novatek’s operational project Yamal LNG on the Yamal Peninsula in northern Russia.

Each of the Arctic Transshipment terminals will include a 360,000 cubic metre-capacity floating storage and regasification unit and two ship-to-ship transfer facilities.

They will allow for the transshipment of LNG from so-called Arc7 ice-class LNG carriers to conventional LNG carriers.

Novatek said recently that the first three trains of Yamal LNG operated at an average of 114% of annual nameplate capacity of 17.4 million tonnes of LNG last year despite the decline in energy demand caused by Covid-19 pandemic.

The company has just recently brought online the fourth train, which is understood to have already reached its full production capacity of 950,000 tonnes per annum.

Novatek has also pushed forward the start-up of the third train at Arctic LNG 2 by one year to 2025.

Decarbonisation drive

Also at the St Petersburg Economic Forum on Thursday, TotalEnergies and Novatek signed a memorandum of understanding (MoU) on decarbonisation, hydrogen and renewable energy initiatives.

“The parties intend to co-operate on reducing greenhouse gas emission at joint projects by implementing carbon capture and storage technologies and utilising renewable energy sources at joint LNG projects,” a joint statement read.

“In addition, the MoU considers the production and usage of hydrogen as a low-carbon fuel, as well as the marketing of carbon-neutral products including LNG.

“Specifically, technical solutions will be considered to improve the efficiency of power generation for LNG production, including using waste heat utilisation technologies.”

The pair will work on solutions for the construction of wind power generation facilities and other renewable energy sources to help cut the carbon footprint of LNG projects.

TotalEnergies holds a 19.4% stake in Novatek.