European companies have supplied equipment for Putin's friend's LNG project worth half a billion euros to circumvent sanctions - rosmedia

European companies have continued to provide equipment to the Arctic LNG 2 project, one of the largest shareholders of which is billionaire Gennadiy Timchenko, throughout the two years of Russia's war against Ukraine. In total, since the introduction of sanctions, Arctic LNG 2 has received European equipment worth 580 million euros. This was reported by the Russian media, UNN reports .

Details

The European Union has banned the supply of any equipment for the production of liquefied natural gas since May 2022, and at the end of 2023, the United States imposed direct sanctions against the Arctic LNG 2 project. However, in January 2024 alone, spare parts and equipment worth 24 million euros were imported from the EU countries for Arctic LNG 2, according to Russian customs statistics.

According to the publication, in 2023, equipment worth more than €220 million was imported. The largest suppliers are companies from Italy (112 million euros), France (31.6 million euros), Germany (25 million euros), the Netherlands (12.8 million euros), and Spain (8 million euros).

"Arctic LNG 2 is a project of PJSC Novatek for the extraction and production of liquefied natural gas on the Gydansky Peninsula in the Arctic zone. Construction began in 2019 in cooperation with French, Chinese, and Japanese investors.

Novatek owns 60% of the project, while French TotalEnergies, Chinese CNPC and CNOOC, and a consortium of Japanese Mitsui and JOGMEC each own 10%. The largest shareholders of Novatek are Leonid Mikhelson (24.76%) and Gennady Timchenko (23.49%), whom Russian President Vladimir Putin himself called his "friend" in 2014 after the imposition of sanctions against a group of Russian billionaires over the annexation of Crimea.

Novatek's other shareholders are Gazprom (9.9%) and French Total (19.4%).

At the end of 2023, the foreign shareholders of Arctic LNG 2 declared force majeure on their obligations to finance the project and purchase LNG from it due to US sanctions. France's Total announced that it had frozen its stake in Novatek.

In October 2022, Novatek CEO Leonid Mikhelson said that all the necessary equipment for Arctic LNG 2 had been delivered before the war, but Le Monde and Spiegel wrote that French and German companies continued to supply equipment for Arctic LNG 2 until mid-2023, fulfilling contracts signed before the sanctions were imposed,

According to the Financial Times, the project is close to launching and will start exporting LNG in 2024. Arctic LNG 2 was built on the technologies of the German company Linde GMBH, which supplied equipment worth more than €58 million in 2022. The main supplier of equipment for Arctic LNG 2 in 2023 was the Italian Nuovo Pignone SRL (BH), which produces equipment for the energy industry. It shipped products worth 41 million euros to Russia.

The leader among French suppliers is Optaperiph, which supplied thermal insulation products, valves, and other equipment worth EUR 6 million.

In 2023, German Siemens supplied Arctic LNG 2 with goods worth more than €4.8 million. In May 2022, the company announced the termination of its operations in Russia, and in February 2024, it began liquidating its Russian subsidiary. However, supplies to Arctic LNG 2 continued throughout the war, with the company supplying valves, washers, nuts, radiators, and ferrous metal products. Arctic LNG 2 received the last Siemens equipment on September 28, 2023.

The Spanish technology company Ampo has supplied Arctic LNG 2 with products worth more than €2 million.

European equipment for Arctic LNG 2 is imported mainly through China.

Recall

The European Parliament adopted a directive criminalizing the violation and circumvention of EU sanctions, establishing uniform definitions and minimum penalties for such offenses.