TotalEnergies silent on Russian decree approving sale of Arctic LNG 2 stake
Overview of Arctic LNG 2 Stake Sale and Industry Response
(Corrects June 3rd story to say Shell, not BP, in paragraph 6)
By America Hernandez
Russian Presidential Decree and Stake Sale Details
MOSCOW/PARIS, June 3 (Reuters) - Russian President Vladimir Putin has approved the sale of a 10% stake in the sanctioned Arctic LNG 2 project held by France's TotalEnergies to a company called Nordline LLC, according to a decree published on Wednesday.
TotalEnergies declined to comment and has not issued any statement on a sale, unlike previous divestments from Russia.
Nordline LLC and Novatek Connections
Reuters has identified two Russian-registered entities named Nordline LLC, both linked to private Russian LNG producer Novatek, the majority owner of Arctic LNG 2, but could not confirm which one might be specified in the decree.
Novatek did not immediately respond to a request for comment.
Western Firms' Exit from Russia
Background on Sanctions and Asset Sales
WESTERN FIRMS EXIT RUSSIA
Since Russia's 2022 invasion of Ukraine and the imposition of Western sanctions, many foreign firms have sold Russian assets or seen them seized, in response to the freezing of Russian assets abroad.
Recent Major Transactions
In 2024, Kremlin-controlled energy giant Gazprom acquired a 27.5% stake in Russian LNG project Sakhalin II by decree, previously held by oil major Shell, which took a $1.6 billion impairment.
TotalEnergies' Position and Remaining Exposure
TotalEnergies has been an outlier, selling smaller Russian oil holdings while retaining its 19.4% stake in Novatek and its interest in the Yamal LNG project, which has seen increased sales of LNG to Europe in recent years.
The June 3 decree on Arctic LNG 2 gave no details on Nordline or the terms of the potential deal.
The project was placed under U.S. sanctions over Russia's invasion of Ukraine, prompting TotalEnergies to declare force majeure on LNG offtake contracts from the project in 2024.
If completed, the sale would still leave TotalEnergies with indirect exposure to Arctic LNG 2 through its stake in Novatek.
Project Shareholders and Reporting Credits
Current Shareholder Structure
Other shareholders in the project are Novatek (60%), China National Petroleum Corp (10%), China National Offshore Oil Corp (10%) and a consortium of Mitsui and Japan Organization for Metals and Energy Security (10%).
Reporting and Editorial Credits
(Reporting by Anton Kolodyazhnyy in Moscow and America Hernandez in Paris.Writing by Maxim Rodionov. Editing by Andrew Osborn, Emelia Sithole-Matarise and Mark Potter)
