A joint venture between China LNG shipping and Teekay LNG has reportedly signed a US$1.6 billion deal to finance six LNG carriers, which will service Russia’s Yamal LNG project.
The carriers, currently being built by South Korea’s Daewoo, can operate the northern route from the Yamal peninsula to destinations on Asia-Pacific market without icebreaker assistance, according to the report in The Asset. The first vessel is expected to deliver in January of next year, while the rest will arrive by 2020.
The development comes as China is committing to reducing dependence on coal. The Asian Infrastructure Investment Bank recently approved a US$20 million loan to connect over 200,000 rural households to the natural gas distribution network.
“China’s commitment to reducing its reliance on coal will change lives and improve the environment, and that is why we are investing in a project aligned with their ambitious plan,” AIIB president Jin Liqun was quoted as saying. “With our unwavering commitment to helping members meet their environmental and development goals, especially their commitments under the Paris Agreement, it is only fitting that our first investment in China will introduce sustainable infrastructure that will reduce greenhouse gas emissions and help vitalize one of the most important economic hubs in Asia.”
The Yamal project, which was recently granted Russian government permission to commission the main technological facilities of the LNG plant’s first stage, features Chinese shareholders and has relied heavily on debt from China.
Vladimir Putin noted at a press conference last week that industrial developments in the Arctic are one of Russia’s top priorities, and that China will play an important role.
The Silk Road Fund holds a 9.9% stake in Yamal LNG. Other shareholders include NOVATEK (50.1%), China National Petroleum Corporation (20%), and Total (20%).
It is a WinWin for Russia sanction busting and World climate.