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Resource base for Novatek’s Arctic LNG-2 estimated at 30 bcm

NOVATEK’s Annual General Meeting of Shareholders, image courtesy of Krassotkin via Wikimedia Commons
NOVATEK’s Annual General Meeting of Shareholders, image courtesy of Krassotkin via Wikimedia Commons

The Utrenneye gas condensate field, which will serve as the resource base for the Arctic LNG-2 project, can supply more than 30 billion cubic meters (bcm) of gas a year, according to Russian news agency TASS, citing Novatek CEO Leonid Mikhelson.

Led by Novatek, Russia’s largest independent natural gas producer, the Arctic LNG-2 project will be located offshore near the remote Gydan peninsula in the northern region of west Siberia. According to commercial intelligence company Woods Mackenzie, the project envisages installation of three gravity-based structures (GBS) in the Ob Bay and the construction of an LNG plant on these platforms.

Ever growing energy demand is pushing continued expansion of the liquefied natural gas (LNG) sector. Spurred on by a growing belief that natural gas could provide a viable, more environmentally friendly alternative to oil and coal, the LNG market is one of the fastest growing in the world.

 

Moving forward

Earlier in July, Novatek announced it had won a license to develop the Gydansky gas block, which lies 80km from the Utrenneye field.

"We have all but finished a development plan for Utrenneye and have estimated its annual plateau production capacity at some 30 bcm, which is enough to make this project profitable,” Mikhelson told TASS. “In other words, we can plan for three production lines, just as at Yamal LNG, each of them producing  some 6 mcm [a year]." 

Yamal LNG is another large scale gas project led by Novatek.

In the Arctic LNG-2 project, each liquefaction line would be installed on a separate ice-resistant platform a short distance from the shore, according to TASS. Gas will be delivered from a field that is located between 40 and 60 kilometers from the platform. Condensate will be extracted at the gas preparation stage. Finished products — condensate and LNG — will be stored on the platforms for subsequent delivery to clients.

“We believe that we have identified the site where the platforms could be set up. We will conduct the remaining 20 percent of exploration work in August and September. The site is very good," Mikhelson said.

Novak plans to complete the construction of the new LNG plant by late 2022 or early 2023. The project has been assessed to be worth around $10 billion.

NOVATEK’s Annual General Meeting of Shareholders, image courtesy of Krassotkin via Wikimedia Commons