Sanctioned Russian LNG Plant Looks Set to Restart Exports

(Bloomberg) -- A liquefied natural gas tanker appears to have docked at a Russian Arctic export plant sanctioned by the US for the first time in eight months, in what is likely Moscow’s latest attempt to expand deliveries of the fuel.

The Iris, an LNG tanker previously known as North Sky, was moored at the Arctic LNG 2 facility early Friday, ship-tracking data compiled by Bloomberg showed. The last time LNG was exported from the plant was in early October, with large-scale production shut shortly after due to tightening sanctions from the US and a build up of ice around the facility.

It’s not guaranteed that Iris will load super-chilled fuel from Arctic LNG 2. The ship has Arc4 ice-class specifications, meaning it can navigate the shorter Arctic route to Asia only when conditions allow it in the summer.

Russia’s plans to triple LNG exports by 2030 have been upended by restrictions from the US and Europe, aimed at reducing Moscow’s revenue from fuel sales following the invasion of Ukraine. A restart of exports from Arctic LNG 2 would indicate that Moscow is still keen to boost deliveries and find willing customers.

Arctic LNG 2 loaded eight shipments on shadow fleet vessels last summer, but ultimately failed to find customers due to the western restrictions. The US sanctioned Arctic LNG 2 in 2023. The Iris and other LNG tankers were sanctioned by the US last year to crack down on the facility’s exports.

Majority shareholder Novatek PJSC and the operating venture Arctic LNG 2 did not respond to emails Thursday seeking comment about Iris heading toward the export plant.

Russia had been trying to revive exports from the project, which was planned to be its biggest LNG plant. LNG production at Arctic LNG 2 appeared to have restarted, Bloomberg reported in May. Satellite images taken on June 25 show that the facility is flaring gas, suggesting production of LNG.

Waters around the Utrenniy terminal, which serves the Arctic LNG 2 project, are still covered in ice, according to June 25 satellite images from the Copernicus Data Space Ecosystem. However, earlier this week, the captain of the Sabetta port allowed Arc4 tankers to navigate the area around the Utrenniy terminal without icebreaker assistance.

The Iris is still signaling that its next destination is Sabetta port, home to the separate Yamal LNG facility, which isn’t sanctioned.

(Updates location of ship in first and second paragraphs.)

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