NOVATEK, one of the largest independent natural gas producers in Russia, and Sovcomflot, Russia’s largest shipping company and a leader in the maritime transportation of hydrocarbons, signed a Strategic Cooperation Agreement to develop a strategic partnership to transport hydrocarbons (LNG and gas condensate) produced at Yamal LNG, Arctic LNG 2 and other Arctic projects of the Company.

Sovcomflot and NOVATEK have a long history of cooperation. In 2010, the tanker SCF Baltica became the first large-capacity vessel to transit the Northern Sea Route with a cargo of gas condensate for NOBVATEK. The aim of that pioneering voyage was to evaluate the ability to export products on the year-round basis across the Northern Sea Route, both East and Westbound.

In 2014-2016 the partners successfully implemented the construction project for Christophe de Margerie, the world’s first Arctic LNG carrier. In December 2017, this vessel transported the first cargo of gas from the Yamal Peninsular. During this work, a unique experience has been gained of operating vessels within the challenging conditions of the Kara Sea and the Gulf of Ob throughout the year.

Our unique partnership with Sovcomflot will optimize our LNG transport model through the Arctic zone by efficiently and effectively using ice-class tankers. To implement our long-term development strategy to produce more than 55 million tons of LNG by 2030, we need to establish an efficient Northern Sea Route shipping model. Combining our efforts with Sovcomflot, one of the global leaders in navigation in harsh ice conditions, will allow us to achieve maximum efficiency in managing our transportation costs.

—Leonid Mikhelson, NOVATEK’s Chairman of Management Board

NOVATEK’s upstream activities are concentrated mainly in the prolific Yamal-Nenets Autonomous Region—the world’s largest natural gas producing area and which accounts for approximately 80% of Russia’s natural gas production and approximately 16% of the world’s gas production.