Novatek confirms building of gas pipeline to Murmansk

The pipeline that will have a capacity to transport 40 billion cubic meters of gas per year will be built by Novatek itself, Mikhelson told journalists during the recent Russian Energy Week.

A decision to build the new infrastructure has been taken on the highest state level following several rounds of discussions, the company leader explained.

About 75 percent of the pipeline gas will be reserved for the projected new Murmansk LNG plant, while the remaining 25 percent will used for the gasification of towns and settlements in the regions of Karelia and Murmansk.

Novatek confirms the information on one of its corporate news channels.

The decision to build the pipeline is confirmed also by the Kremlin. In his speech at the Energy Week, Vladimir Putin said that the pipeline Volkhov-Murmansk-Belokamenka will be instrumental not only for the production of LNG in Murmansk.

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“Parts of its capacity - up to ten billion cubic meters per year - will be used to supply companies, social objects and buildings in Karelia and Murmansk Oblast, and for development of environmentally friendly electricity generation,” he told the audience of oilmen and energy sector representatives.

He also said that Russia has “big plans” in the field of LNG, and that production is due to triple to 100 million tons per year in the course of the next decade.

According to Leonid Michelson, the new pipeline will be powered by surplus energy from the Kola Nuclear Power Plant, which will allow Novatek not to rely on sanctioned gas turbines from western manufacturers. The projected three development trains are estimated to need a total capacity of 1500 MW.

The powerful company leader also underlines that the new LNG plant in Murmansk will take advantage of the major volumes of natural gas that have become available following the export cuts to the EU.

With the building of the pipeline to Murmansk, Novatek challenges the gas monopoly of Gazprom. The state energy company today fully controls the national gas pipeline grid and is believed to be highly dissatisfied with Novatek’s new plans.

A Russian energy analyst says to RBC that the 1,300 km long pipeline from Volkhov near St.Petersburg to the Kola Peninsula could be ready in 2027, the same year that Novatek intends to complete the first of three projected trains in the Murmansk LNG. The construction price is estimated to about 450 billion rubles (€4,37 billions).