Russia Expects China to Join Arctic LNG 2 Project

The First Deputy Head of the Russian Government Office Sergei Prikhodko told reporters on Monday that Russia expects China to enter Novatek’s Arctic LNG-2 project, TASS news agency reports.

Prikhodko was commenting on Prime Minister Dmitry Medvedev’s visit to China, scheduled for this week.

“We believe that our Chinese partners may show interest in another project – the Arctic LNG-2,” he said.

According to the official, the gas industry is an important area of Russia’s energy cooperation with China. The construction of an east-route gas pipeline from Russia to China is planned to be completed by the end of 2019. The 30-year contract says that 38 billion cubic meters of gas will be supplied through the new pipeline every year.

Earlier reports said that Saudi Arabia planned to purchase 30% of shares in the Arctic LNG-2 project. Saudi Energy Minister Khalid Al-Falih said that Saudi national gas company Aramco intends to enter the project and become its second largest shareholder after Russia’s Novatek.

In October, the head of Russia’s sovereign wealth fund, the Russian Direct Investment Fund (RDIF), Kirill Dmitriev said that Saudi Arabia was ready to invest about $5 billion in the project.

According to Novatek’s estimates, Russia will be producing over 80 million tons of LNG by 2030, while the company plans to occupy two-thirds of the market.