Repercussions of Sanctions: Blow to Novatek PJSC

The only construction yard of the Russian Federation designed for modules of liquified natural gas has almost ceased its activity. It is another sign of how sanctions imposed by Western states are undermining the capability of Russia to be a leading player in the energy market.   

The Belokamenka facility owned by Novatek PJSC and located on the Barents Sea has been significantly mothballed. Satellite data shows that the intensity of night-time light at the facility is the lowest since 2019. This facility was supposed to become a huge hub for assembly of LNG trains capable of turning natural gas into liquid form.

However, although two trains for the facility have been built, the satellite data demonstrates that there is no activity needed to boost capacity of the facility in the nearest future. It has occurred because of sanctions imposed by the US and the EU on Novatek and all future projects, for instance, tankers, shipment and production facilities, to limit energy revenues of Moscow after its invasion of Ukraine.  

Novated decided to assemble LNG production facilities near Murmansk instead of building them from scratch in the Arctic climate. The Belokamenka facility constructed two trains for the LNG-2 project, and each train consists of 14 modules placed on a huge platform. Then small tug vessels towed these two trains across the Northern Sea Route and docked them at the Gyda peninsula. These two trains were installed at the LNG-2 facility; one of these trains had been producing liquified natural gas until October, when sanctions imposed by Western states made the process of shipping and selling cargoes almost impossible and led to the closure of the facility. A partly built third train stays at the Belokamenka facility.

The satellite data indicates that the intensity of light at the construction yard of Novatek was at its highest from 2022 to 2023, when the facility was constructing these two trains for the LNG-2 project. The dimming of the lights at the facility in 2024 demonstrates a pause in building at Belokamenka and a serious obstacle to achieving the goal of Russia to take more than 20% of the global market of liquified natural gas within the next ten years.

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