TotalEnergies Remains Silent as Russia Approves Sale of Arctic LNG 2 Stake

Russian President Vladimir Putin has approved the sale of a 10% stake in the sanctioned Arctic LNG 2 project held by France's TotalEnergies to a company called Nordline LLC, according to a decree published on Wednesday.

TotalEnergies declined to comment and has not issued any statement on a sale, unlike previous divestments from Russia.

Reuters has identified two Russian-registered entities named Nordline LLC, both linked to private Russian LNG producer Novatek, the majority owner of Arctic LNG 2, but could not confirm which one might be specified in the decree.

Novatek did not immediately respond to a request for comment.

WESTERN FIRMS EXIT RUSSIA

Since Russia's 2022 invasion of Ukraine and the imposition of Western sanctions, many foreign firms have sold Russian assets or seen them seized, in response to the freezing of Russian assets abroad.

In 2024, Kremlin-controlled energy giant Gazprom acquired a 27.5% stake in Russian LNG project Sakhalin II by decree, previously held by British oil major BP, which took a $1.6 billion impairment.

TotalEnergies has been an outlier, selling smaller Russian oil holdings while retaining its 19.4% stake in Novatek and its interest in the Yamal LNG project, which has seen increased sales of LNG to Europe in recent years.

The June 3 decree on Arctic LNG 2 gave no details on Nordline or the terms of the potential deal.

The project was placed under U.S. sanctions over Russia'sinvasion of Ukraine, prompting TotalEnergies to declare force majeure on LNG offtake contracts from the project in 2024.

If completed, the sale would still leave TotalEnergies with indirect exposure to Arctic LNG 2 through its stake in Novatek.

Other shareholders in the project are Novatek (60%), China National Petroleum Corp (10%), China National Offshore Oil Corp (10%) and a consortium of Mitsui and Japan Organization for Metals and Energy Security (10%).

(Reuters)