Russian LNG Carrier Forced to Store Sanctioned Cargo After Failed Four-Month Search for Buyers

By Stephen Stapczynski (Bloomberg) —

A vessel carrying a sanctioned shipment of Russian liquefied natural gas appears to be offloading the fuel into storage in the nation’s far east, having failed to find a buyer willing to circumvent US restrictions despite a four-month, across-the-world journey.

The Pioneer tanker, carrying a cargo from Russia’s Arctic LNG 2 facility, docked next to the Koryak floating storage unit in Kamchatka on Thursday, according to ship-tracking data compiled by Bloomberg. The gas is likely to be held there until a customer can be found.

Arctic LNG 2, Pioneer and Koryak have all been sanctioned by the US.

Pioneer was spotted on satellite images picking up the first shipment from the Arctic LNG 2 facility in early August — despite camouflaging the move with misleading location information — but then spent well over four months hunting for a customer. The lengthy journey underlines just how US restrictions are hampering Moscow’s plans to expand LNG exports threefold by 2030. 

While several shipments have been exported from Arctic LNG 2, Russia’s newest facility, all have used dark fleet vessels and none have docked at a foreign port, as potential buyers fear retaliation from the US.

Arctic LNG 2 was forced to temporarily shut production in October due to a lack of both buyers and vessels able to navigate the facility’s icy waters. Russia is rushing to build ice-breaker vessels, with ship-tracking data indicating that the first such tanker is undergoing sea trials.

Novatek PJSC, which leads the Arctic LNG 2 project, didn’t immediately respond to a request for comment outside Moscow business hours.

© 2024 Bloomberg L.P.

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