Geoffrey Pyatt, Deputy Secretary of State before the Senate, stated: “We have imposed fresh sanctions on Arctic LNG-2. Our goal is to destruct this project" (kill that project).
The State Department together with OFAC (a celebrated branch of the U.S. Department of Commerce that sanctions the economy and businesses) “screws the screw”. He banned American people and corporations from holding shares and trading with a Russian Arctic venture. He gave time until the end of January to exit capital or financial ties with the company. Pyatt besides stated that "we do this through our sanctions, working with partners with G-7 and more".
The authoritative justification can be found that the intent of the sanctions is "to reduce the production and export of Russian energy natural materials". specified arguments are utilized by the world's energy gendarme, which has been again the largest maker of oil and natural gas in the planet for respective years. Which opens respective fresh LNG export terminals in the coming years. As you can see, 1 hand builds its own, the another chokes its competitors. The little gas liquefaction projects, the higher the prices that US exporters will benefit from. Just like with atomic blocks in Poland. It offers its own and Korean competition roams the courts, blocking its ability to cooperate with Poland.
Sanctions on Arctic LNG-2 are a serious blow to Novateka's project, which is due to start production and export of liquefied gas in December. But not just Russia. The victims of these sanctions are mainly the companies of 2 countries from the 7 Group. Arctic LNG-2 is simply a co-ownership of Novatek (60%), French TotalEnergies (10%), Chinese CNPC (10%) and CNOOC (10%), and nipponese MITSUI and JOGMEC, besides 10%.
What are the Americans so afraid of that they want to "destroy" this project? I don't think they're afraid, that's not the word. In Washington, they know precisely how to fight economically against competition or enemies. They have hundreds of years of experience, the baptism of combat went through in the 19th century erstwhile they won the economical war with Britain. They then shielded their economy with advanced duties from the unrivalled English manufacture at the time. At the same time, they brought together all resources – people, capital. To this day, they inactive practice it effectively. They besides have experience, and in this case besides masterfully exploit it.
The sanctions actually hit the French and nipponese shareholders of this project. The French are inactive trying to play not entirely under the dictatorship of an ally, entering where Americans stay distant for reasons of political conflict. The nipponese stick to their own interests, and erstwhile they are threatened – they negociate with Washington.
This was the case with shares in the Sakhalin oil and gas mining projects. erstwhile Exxon or Shell came out of the Ukrainian war, the nipponese decided to stay. But the force on them to abandon Russian deposits was so large that they had to go to negotiations in Washington. Caring there and asking for a favorable explanation of the rules – this is simply a standard script in specified situations. The results of specified negotiations are not revealed, but in view of the behaviour of European or nipponese companies, the primary request may be to invest in the US.
The nipponese are mostly the largest investor in U.S. government debt papers, and they besides place immense money in the US industry. But besides French TotalEnergies did not magpie under the tail. It has many investments in LNG production in the US. The French entered the NextDecade task in June, contracting to receive 5.4 million tonnes from Rio Grande LNG, have shares in Cameron LNG, mostly wanting to receive 15 million tonnes a year from 2030 from the US. This is much more than LNG from Russia, where it buys only 4 million tonnes per year.
TotalEnergies maintains its presence in Russia despite powerful pressures, including sanctions imposed by Washington. It holds shares in Novateka's first venture – LNG Jamał (20%) as well as in Arctic LNG-2 (10%). He is besides a crucial shareholder (19.4%) of Novatek himself. After the war broke out, the French were forced to declare their exit from Russian investments, cancelled their representatives from Novatek's board, but inactive receive 4 million tons of gas a year from Jamal LNG on long-term contracts. However, to lavender under the force of an energy “global regulator” requires skill and cunning.
About the Arctic LNG-2 task in the next issue of Polish Thought...
Andrzej Szczęsniak
Think Poland, No. 47-48 (19-26.11.2023)
