Western economical sanctions have not brought the Russian economy to its knees. However, in individual cases, specified as liquefied LNG, Washington shows that it can actually ‘kill’ a competitive project.
Two years ago, Geoffrey Pyatt, Deputy Secretary of State of the United States, stated "we have imposed fresh sanctions on Arctic LNG-2, our goal is to kill this project" (https://mysłpolska.info/2023/11/17/lucky-needs-destroy-this-project). He knew what he was saying – many decades, hundreds of years of American experience in economical wars gave him this confidence. And indeed – for almost 2 years full ready to produce LNG, the Russian Novateka installations were idle. Only now do the Chinese save them with tiny quantities.
The power to strike US sanctions in the global LNG industry, operating a dollar as a weapon, is enormous. They were imposed on Arctic LNG-2 at the minute erstwhile the installation started, after many years of difficulty, to overcome problems caused by a cut-off from western technology. Novatek is simply a private Russian tycoon, extracting 12% of Russian natural gas. However, its dynamic growth was rapidly hampered by a single decision by the American office. Despite the tremendous natural material potential, the global marketplace is only in the second 10 suppliers. The American marketplace and their allies dominated – state-owned QatarEnergy, Shell, TotalEnergies, Cheniere and Petronas account for 60% of LNG supplies. Novatek would have been much higher in this ranking if his improvement had not been blocked.
The Russians handled the challenges of highly advanced technologies, built and launched LNG production lines themselves. Arctic LNG-2 is the largest export installation in Russia with nearly 27 billion m3 (by 50% more than Poland uses). After the imposition of sanctions, production had to be discontinued, as the warehouses were filled, and here neither gas or customers... Gas is looking forward to audiences who do not want to be on the celebrated "black list" of SDN, issued by OFAC (Szczęsniak: The office of the global economical war | Think Poland). This means the destiny of a pariah, who must, as they utilized to say, “walk in the sewers.” He's being bypassed by buyers and abroad investors, frightened by sanctions. Although all production installations are full operational, they can condense natural gas but cannot export it.
Russia has set ambitious targets: it has inactive late planned to triple LNG exports in 2030 and scope 135 billion m3 per year. That's more than all 4 Nord Stream threads could always send. However, last year Russia exported only 47 billion m3 of LNG [34,075 million tonnes], including a decrease in production. The question is, will Russian LNG exports actually go back six years?
In Russia, only 2 LNG production lines work in full steam – supplying Asia with "Sachalin 2" (the co-owners are Gazprom and nipponese Mitsui and Mitsubishi, erstwhile Shell was, but he fled for fear of sanctions). The second is the Arctic ‘LNG Jam’ Novatek (50.1%), co-owned by French TotalEnergy (20%) and Chinese state-owned CNPCs (one of the largest oil and gas companies in the planet – 20%) and Chinese SRF (Silver way Fund – 9.9%). These export terminals work full steam, stablely, with microscopic fluctuations in production.
Sakhalin functions thanks to the skill of the nipponese in defending their own interests in Washington, D.C., after all, they must take care of 1 tenth of the natural gas supply (LNG, due to the fact that pipelines do not supply to these islands). The second geographically close recipient, South Korea, is besides capable of seeking the Potomac for its safety of supply. This is not easy due to the fact that OFAC has the habit of issuing alleged "general licenses", that is, permissions not to respect sanctions imposed on "killed" by the American economical operator. And they're a temporary, usually a year before you gotta decision again and search the approval of bureaucracy in the Washington halls.
But in the escalation of the trade war, erstwhile landings on Venezuelan tankers are already taking place, the installations presently producing may not stand. Russia's only hope is China.
Andrzej Szczęsniak
photo. novatek.ru
Think Poland, No. 51-52 (21-28.12.2025)
