lng ship bunkering in fog. Photo by VladSV / Shutterstock.com
A liquefied natural gas tanker carrying sanctioned Russian gas has reappeared near China’s Hainan Island three weeks after a dark STS transfer. It is likely bound for the nearby Beihai terminal. The vessel received its cargo from a Chinese LNG carrier in the first-ever ship-to-ship transfer of sanctioned Russian gas.
The transfer occurred on October 18 involving the 170,471-cbm Perle and the 145,000-cbm CCH Gas. Both vessels attempted to hide their activity by spoofing their AIS signals. Satellite imagery showed the vessels side to side around 50 nautical miles off Malaysia’s coast.
While CCH Gas continues to send out a false AIS signal, Perle has since reengaged its transponder and made its way to Salalah, Oman.
Following the transfer the vessels escaped further scrutiny due to cloudy weather and limited satellite coverage. CCH Gas has now reappeared off the coast of Hainan Island, satellite images taken by Copernicus Sentinel-2 on November 9 reveal. The gas carrier can be seen steaming west toward the Gulf of Tonkin and the Beihai terminal.
In August China opened up the import terminal to sanctioned Russian gas cargoes. Since then the facility has received 13 deliveries, all from the Arctic LNG 2 project.
CCH Gas is carrying supercooled gas from Russia’s sanctioned Baltic Portovaya plant. A successful delivery by the vessel would be a sign of China’s willingness to expand imports at Beihai beyond the Arctic LNG 2 project. The U.S. sanctioned the Portovaya facility on January 10, 2025.
The arrival of Russian cargoes have already resulted in downward pressure on regional prices. China is receiving up to 40 percent discounts on Arctic LNG 2 deliveries. The landed cost of Arctic cargoes at Beihai is said to be around $7.00/MMBtu, substantially below existing spot rates.
It remains to be seen if Beihai terminal can continue its role as a regional price-setter during the upcoming winter season. Due to a shortage of ice-class LNG carriers, Russian gas company Novatek will likely be forced to partially mothball the Arctic project for the next 6-8 months.
Pickups at the plant have begun to slow down in recent days as conventional gas tankers can no longer use the Arctic shortcut and are being routed via the Suez Canal.
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