The Yamal LNG project is one of the largest industrial undertakings in the Arctic, says partner Total. The Yamal peninsula LNG project is technologically, politically, and economically challenging, notes the US Energy Information Administration (EIA). The plant will be situated on unstable permafrost, and shipping will take place via the Kara Sea, which is icebound for about 10 months of the year.

Location of the project. Inset: Yamal LNG. Click to enlarge.

The field development plan provides for the drilling of approximately 200 wells at 19 well pads, construction of a gas gathering pipeline system, gas treatment facilities and a liquefaction plant.

The Yamal LNG plant will consist of three liquefaction trains with overall capacity of 16.5 million tons per year. Start of commissioning works at the first liquefaction train is scheduled for 2016 with the planned commercial launch of the first LNG train in 2017.

Gas fields in the Yamal peninsula. Source: Gazprom, Yamal LNG. Click to enlarge.

The project also requires the construction of transport infrastructure including a sea-port facility and an international airport located at Sabetta (north-east of the Yamal Peninsula). Up to 16 ice-class LNG carriers of special ARC-7 design, each able to transport 170,000 m³, will be used to effect year-round transportation of LNG to international markets.

As part of the Project implementation, main tenders have been completed and key contracts have been signed. The EPC contract has been awarded to the joint venture of Technip and JGC.

Currently, the orders for long-lead items (including cryogenic heat exchangers, gas turbines, and the compressors for the liquefaction trains) have been placed; eight (8) production wells have been drilled, more than 3,100 construction workers are already on site. Preparation of the construction site for the LNG plant has been completed, the piling of the foundation for the LNG tanks has begun, the construction of the sea-port and airport has reached an advanced stage, and more than 70% of the expected LNG production output has already been contracted.

The South-Tambeyskoye field was discovered in 1974 and is located in the north-eastern portion of the Yamal Peninsula. The field has five shallow gas horizons and 37 deeper gas condensate horizons. The depth of the horizons varies from between 900 to 2,850 meters. According to the PRMS reserve standards the proven and probable reserves of the South-Tambeyskoye field as of 31 December 2012 were appraised at 907 billion cubic meters of natural gas.

Yamal LNG is a joint venture currently owned by OAO Novatek (80%) and Total S.A. (20%). On 5 September 2013, Novatek and CNPC concluded an agreement on the purchase of a 20% equity share in Yamal LNG by CNPC. The transfer of title to the equity share is subject to receipt of necessary regulatory approvals. Following completion of the deal, the shareholder structure of Yamal LNG will be as follows: OAO NOVATEK (60%), Total S.A. (20%) and CNPC (20%).