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(Bloomberg) — Russia is taking another crack at expanding exports of liquefied natural gas after US sanctions stalled efforts last year.
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An LNG vessel has docked at the Arctic LNG 2 export facility for the first time since October, according to ship-tracking data compiled by Bloomberg and satellite images. The facility was supposed to be a cornerstone of Moscow’s goal to increase LNG exports threefold by 2030, but has been idle for months after struggling to find buyers willing to break western restrictions.
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Russia has the pieces in place to meaningfully boost LNG exports as it expands its shadow fleet. Since the 2022 invasion of Ukraine, Russian gas pipeline exports to Europe have dwindled, and shipping more fuel via seaborne LNG tankers provides an attractive revenue stream to fill Moscow’s coffers.
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Shadow Fleet
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At least 13 ships, including those that can navigate icy waters, have been marshaled to potentially service Arctic LNG 2, with some changing management companies several times to help obfuscate the actual owners. According to ship-tracking data compiled by Bloomberg they include:
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- Four ice-class vessels that can navigate the frozen waters around Arctic LNG 2. Three are currently idled in the Barents Sea, while another is the tanker currently docked at Arctic LNG 2
- Three more traditional LNG vessels are in the Barents sea
- Two vessels are under repair in China, with another that appears to be on the way
- One vessel near a floating storage in Russia’s Far East
- Two vessels are idled in the the Gulf of Finland. They had served another Russian facility called Portovaya, which was sanctioned by the US in January
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“Russia does have more vessels at its disposal compared to the summer/fall of 2024,” Malte Humpert, founder of the Arctic Institute, a Washington-based think-tank, said in an email. “If it can find buyers, this small fleet should be sufficient to lift cargoes.”
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Eight shipments were exported from Arctic LNG 2 between August and October 2024, but never docked on foreign shores. Instead, the gas was offloaded into two Russian storage units in the Barents Sea and its Far East region. Large-scale production halted in October after ice built up around the facility and made transport by traditional vessels challenging.
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Russia’s first domestically built ice-class LNG tanker may come online in the second half of this year if it passes remaining sea trials, Interfax reported Wednesday, citing Sovcomflot Chief Executive Officer Igor Tonkovidov.
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Willing Buyers?
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Now, the market will be closely monitoring whether Arctic LNG 2 can find willing buyers. Exporting more would be a boon for consumers, as it would put pressure on global gas prices.
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The Biden administration was diligent in sanctioning ships and companies connected with exporting fuel from Arctic LNG 2 last year. It isn’t clear if the Trump administration will be as strict, or if the government will slap restrictions on ports that accept the fuel. The threat of retaliation from the US kept buyers at bay last year.
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