TotalEnergies has asked the French government and the European Commission for clarification on the ban on Russian LNG. The company warns that the current interpretation could prevent European companies from marketing LNG from Russia.
Russian LNG ban
According to its CEO Patrick Pouyanné, the measure was not anticipated in these terms and could directly affect the Yamal LNG project‘s operations. If the company cannot sell this gas on international markets, it is even considering abandoning the project.
TotalEnergies is currently one of the largest buyers of Russian LNG. Russian LNG with close to five million tons per year destined for customers in Europe and Asia. It also holds a 20% stake in Yamal LNG and about 19.4% in Novatek , the project’s parent company.
The French energy company stopped consolidating Russian assets in its financial reports and declared force majeure in Arctic LNG 2 after the U.S. sanctions. In addition, it faces difficulties in repatriating dividends with more than $2 billion retained in Russia.
Some energy market analysts warn that preventing the marketing of Russian LNG by European companies could raise contractual risk and limit supply in the Atlantic basin.
For now, TotalEnergies awaits clear definitions on the scope of the ban and its implications for project ownership and the sale of cargoes outside the European Union. The outcome will be essential for the balance between energy security, sanctions and price stability in the EU bloc.
Source: Reuters
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