TotalEnergies Completes Exit from Russia’s Arctic LNG 2 Project

On August 27, TotalEnergies announced the transfer of its 10 % equity interest in the Arctic LNG 2 project to NordLine, a Novatek subsidiary. The French group retains a right to reimbursement for its share of shareholder loans, estimated at about US $1.3 billion, subject to the future sanctions environment.

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Arctic LNG 2 has been under Western sanctions since Russia’s invasion of Ukraine in 2022. TotalEnergies recorded a $4.1 billion impairment on the stake that year and fully wrote it off. After U.S. sanctions in November 2023, the company suspended its contractual rights. President Vladimir Putin approved the sale on June 3, allowing the transfer to proceed. TotalEnergies also holds a 20 % stake in Yamal LNG and a 19.4 % holding in Novatek, both still constrained by sanctions.

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• Stake transferred: 10 % of Arctic LNG 2 to NordLine.

Oil Price

• Loan claim: approximately US $1.3 billion, repayment subject to sanctions.

The Globe and Mail (Toronto)

• Impairment: $4.1 billion written off in 2022.

Oil Price

• Annual earnings from Yamal: about $400 million (varies with oil prices).

TotalEnergies exits Arctic LNG 2 as European ties to Russian LNG persist

• Arctic LNG 2 capacity: 19.8 million metric tons of LNG per year.

Oil Price

• EU policy: Ban on Russian LNG imports scheduled for January 2027.

TotalEnergies exits Arctic LNG 2 as European ties to Russian LNG persist

TotalEnergies confirmed the completion of the transfer and noted that it is no longer a shareholder in Arctic LNG 2. “Such reimbursement might be implemented in the future subject to applicable sanctions,” the company said.

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Chief executive Patrick Pouyanne said the Yamal partnership has returned some cash, though not the full amount. He added that Novatek approached TotalEnergies to discuss the transfer.

Moscow Times

The exit marks a concrete step in the disengagement of Western energy firms from Russian Arctic gas projects, while TotalEnergies still benefits from Yamal LNG sales and retains equity in Novatek. European maritime services that support Arc7 LNG carriers remain linked to the supply chain, highlighting the gap between political objectives and existing infrastructure.

TotalEnergies exits Arctic LNG 2 as European ties to Russian LNG persist

• Repayment of the $1.3 billion loan claim will depend on sanctions and any EU or U.S. policy changes.

The Globe and Mail (Toronto)

• The EU’s planned ban on Russian LNG imports in January 2027 will further restrict European involvement, though exemptions for third-country transfers remain.

TotalEnergies exits Arctic LNG 2 as European ties to Russian LNG persist

• TotalEnergies’ stakes in Novatek and Yamal LNG are expected to stay unchanged until the sanctions regime permits a sale or other resolution.

Moscow Times