Russian liquefied natural gas (LNG) producer Novatek has reduced prices for its Arctic LNG 2 cargoes to attract Chinese buyers, sources familiar with the matter told Reuters.
The move, with discounts of 30% to 40% since August, has allowed the $21-billion project to finally secure buyers after months of commercial uncertainty.
The Arctic LNG 2 plant, co-owned by associates of Russian President Vladimir Putin, began production in December 2023 but failed to sell any cargo until August.
The first cargo, delivered on 28 August, was sold at $3 to $4 below the Asian LNG benchmark price of around $11 per mmBtu, according to an industry source.
Since then, 14 cargoes have been sold at steep discounts, costing $28 million to $32 million each, below the market value of over $44 million. The identities of the Chinese buyers have not been disclosed.
The project faced some of the strictest U.S. and European sanctions,
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