The Arctic LNG 2 project, Russia’s flagship liquefied natural gas (LNG) facility, has slowly resumed gas processing after months of suspension, Reuters reported on Tuesday, citing industry sources and satellite imagery.
The project has been heavily impacted by U.S. and EU sanctions since last year, which have prevented it from selling any LNG cargoes. The first production train at the plant was shut down in early October due to the developers’ inability to secure buyers amid the sanctions, according to a source familiar with the situation.
The plant has now resumed gas processing, but at a reduced rate. Russia is waiting to see how the Biden administration will handle the ongoing sanctions.
Novatek, the Russian LNG developer and majority owner of Arctic LNG 2, has been working to rebuild relations with the U.S. through lobbying efforts, sources told Reuters in December.
The sanctions have taken a toll on the project, which was effectively put on hold last year. Novatek has struggled to find buyers for its LNG. Located on the Gydan Peninsula, Arctic LNG 2 was a key part of Russia’s plan to increase its share of the global LNG market from 8% to 20% by 2030-2035.
However, the project has faced mounting challenges due to U.S. sanctions. These sanctions have discouraged potential buyers who were previously interested in purchasing LNG from the facility.
The project has been delayed for months after the initial U.S. sanctions in November 2023 disrupted the production and export schedule. In August 2024, the U.S. State Department escalated its efforts to block Arctic LNG 2 exports by targeting companies involved in its development and vessels that loaded LNG from the facility.
The U.S. also imposed sanctions on several companies linked to the project, further hindering its ability to produce, export, and secure critical LNG carriers.
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