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Saipem Eyes Russia’s Arctic LNG Project

Saipem will take part as a subcontractor to design the gravity-based units.
Saipem will take part as a subcontractor to design the gravity-based units.

Italy's Saipem is likely to get a subcontractor role in a new project to produce liquefied natural gas in the Arctic by Russia's Novatek, one of Novatek's partners said.

Novatek, Russia's largest non-state LNG producer, is aiming to produce as much LNG as the world's biggest exporter Qatar and is drawing up plans to build a second plant, known as Arctic LNG 2, on the Gydan Peninsula that juts into the Kara Sea. Production is due to start in 2022-23, Reuters reported.

Four sources told Reuters earlier this month that Saipem was expected to be chosen to build offshore platforms for the facility.

"It is planned that Saipem will take part as a subcontractor to design the gravity-based units. That's where they have expertise and experience," said Boris Lim, the head of NIPIGAZ, an engineering firm on the project and a Novatek partner.

"The gravity-based units will sit on the seabed some 40 kilometers from the onshore gas deposit and will produce and ship LNG," Leonid Mikhelson, Novatek's CEO, said.

Mikhelson told reporters in comments cleared for publication on Monday that Novatek was also in talks with Saipem to possibly give the Italian firm a partner role in managing the company that will oversee the shipyard to be built on the Kola Peninsula in northwest Russia. He said more foreign firms might also participate.

The Utrenneye gas field will be the resource base for Arctic LNG 2. For now, Russia has just one operational LNG facility run by Gazprom on the Pacific island of Sakhalin.

 

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