China Takes LNG Cargo From US-Sanctioned Russian Facility
(Bloomberg) -- A Chinese state-run terminal appeared to take delivery of some liquefied natural gas from a US-sanctioned Russian facility, according to shiptracking data, which would mark the first such trade as Moscow tries to maintain its energy exports.
The Arctic Mulan vessel left the Beihai LNG terminal on Friday, a day after docking there. The ship’s draft was at 8.7 meters as it departed, down from 9.8 meters previously, indicating it discharged some of the cargo it was carrying from Russia’s Arctic LNG 2 export plant, the data shows. A trader familiar with the Chinese terminal also confirmed that LNG was discharged from the vessel.
It would be the first successful delivery by Russia’s Arctic LNG 2 project, which has faced issues in finding buyers after it was blacklisted by US President Joe Biden’s administration in late 2023. Moreover, state-owned Chinese firms have been reluctant to accept fuel from sanctioned vessels or facilities, making this LNG delivery all the more rare.
Arctic Mulan loaded an LNG shipment from a floating storage unit in eastern Russia in early June, according to ship-tracking data. The fuel in storage was sourced from the Arctic LNG 2 facility, which ramped up gas production to record levels this month.
At least four more vessels from Arctic LNG 2 appear to be on the way to North Asia, while another gas carrier, La Perouse, is currently docked at the plant, Bloomberg’s vessel-tracking data shows. If the tanker is loaded, that would be the sixth export cargo from the facility since June.
One of the tankers was shown heading toward China and estimated to arrive in Beihai on Sept.4, according to the Northern Sea Route General Administration on Aug. 18. The notice was later deleted.
Arctic Mulan’s arrival came just days before Russian President Vladimir Putin is due to arrive in Beijing this Sunday to meet with his Chinese counterpart Xi Jinping and other leaders, amid intensifying efforts by the Trump administration to stop the war in Ukraine.
READ: Putin Meets With Modi and Xi to Thrash Out Energy Needs
China Foreign Ministry spokesperson Guo Jiakun said at a daily press briefing on Friday that he wasn’t aware of the situation.
Market participants have been keenly following the movement of the vessel for signs of how Arctic LNG 2 can circumvent US sanctions. The project is part of the Kremlin’s vision to triple Russian LNG exports by 2030. Moscow has been trying to find new buyers for these exports after European importers curbed purchases.
Bloomberg News could not immediately ascertain whether there is a buyer for Arctic Mulan’s shipment. PipeChina, Novatek and Arctic LNG 2 did not respond to requests seeking comment.
(Updates with further details in the fourth and fifth paragraphs.)
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