TotalEnergies CEO: Arctic LNG 2 plant to be closed in Russia

* Total of?10% stake ceded to Novatek subsidiary

* CEO says it's in the company's best interest

There is no mention of the sale price

By America ?Hernandez

Patrick Pouyanne, the CEO of TotalEnergies, announced on Thursday that it would be selling its stake in Russia's Arctic LNG 2 facility.

He told analysts during a call on the second quarter results that the transfer of Total's stake of 10% to Nordline, which is a subsidiary owned by the majority owner of the Novatek plant, had been approved by Russian authorities.

Total has retained ownership of key Russian LNG plants following Western sanctions against Russia in the aftermath of the invasion of Ukraine. However, it is considering selling these stakes because European Union sanctions will ban companies from importing or selling this gas after 2027.

Pouyanne explained that Novatek approached him about a possible transfer "soon after Arctic LNG 2 was subject to U.S. sanction in November 2023." Pouyanne noted that Total declared force majeure in 2022, and had taken a $4.1billion impairment on the project. He said the proposal was in the best interest of the company. The CEO didn't use the word'sale.' TotalEnergies'?press officer declined to comment whether Total expects to be compensated and at what value. Many foreign companies have either sold or had their Russian assets seized in the aftermath of the 'war. Gazprom, the Kremlin's energy giant, acquired by decree in 2024 a 27.5% share of Sakhalin II, a Russian LNG project, that was previously owned by Shell. Shell had to take a $1.6billion impairment. Reporting by America Hernandez, Paris. Editing by Charlotte Van Campenhout & Louise Heavens.

(source: Reuters)