Russia Keeps Sanctioned Arctic LNG Exports Alive With Icebreaker

Russia has used a single icebreaker ship to continue exporting liquefied natural gas from a US-sanctioned project in the Arctic through the winter, highlighting Moscow's need for more vessels that can traverse icy waters.

The Christophe De Margerie docked at the blacklisted Arctic LNG 2 export plant on Monday, and is poised to export its third shipment since Dec. 20, according to ship-tracking data compiled by Bloomberg. The tanker is the only operating ship identified in the Russian shadow LNG fleet that's capable of navigating frozen areas all year round.

The ice around the Arctic LNG 2 facility becomes too thick for traditional vessels during winter, with one ship forced to halt an attempt to load fuel last month due to the buildup.

Christophe De Margerie, an Arc7 build, delivered its last two shipments to the Saam floating storage unit in Russia's western Murmansk region. Fuel in that storage facility can be picked up by regular vessels and brought to China, the sole buyer of sanctioned Russian LNG. This trade is likely to continue until the shorter eastern sea route reopens when the ice melts during the summer.

The continued exports are a shot in the arm for Russia, which is struggling to boost gas sales amid tightening western restrictions and the loss of Europe as its top buyer. Arctic LNG 2 was forced to significantly curtail production last winter due to the lack of shipping and brimming storage.

The single icebreaking vessel is allowing Arctic LNG 2 to operate at roughly 25% of its current capacity, the ship data shows. Russia last month finished its first domestically built ice-class LNG tanker, Alexey Kosygin, which is heading toward the Arctic from the nation's far east. This ship could also help unlock more exports from the same plant.

Arctic LNG 2, Saam and Christophe De Margerie were all sanctioned by former US President Joe Biden's administration.

Source: Bloomberg Europe