Russian President Vladimir Putin has approved the transfer of French energy giant TotalEnergies’ 10% share in the Arctic LNG 2 project, a significant liquefied natural gas venture situated in northern Siberia. The stake will be taken over by NordLine, a subsidiary of Novatek, the Russian gas producer that already owns a 60% share in the project. The financial terms of this transaction have not been made public.
The Arctic LNG 2 project has been grappling with difficulties following the imposition of U.S. sanctions in late 2023. These sanctions led foreign stakeholders, including TotalEnergies, to halt their involvement. TotalEnergies had already experienced substantial financial losses in its Russian energy investments after the conflict in Ukraine began.
In addition to TotalEnergies, the project’s foreign stakeholders consist of Chinese energy firms and a Japanese consortium, each holding a 10% interest. The transaction underscores Russia’s determination to maintain domestic control over critical energy assets amidst continuing international sanctions that impact foreign participation in its energy sector.
Analysts are keeping a close watch on the implications for foreign investments in other Russian LNG projects, as Europe considers implementing more stringent restrictions on Russian gas imports. This development is seen as part of a broader strategy by Russia to consolidate its energy resources under domestic ownership, reducing reliance on foreign partners who may be influenced by geopolitical pressures.