Shell exits Russian LNG joint venture with Gazprom

A logo of Shell is pictured at a gas station in the western Canakkale province, Turkey April 25, 2016. — Reuters pic
A logo of Shell is pictured at a gas station in the western Canakkale province, Turkey April 25, 2016. — Reuters pic

MOSCOW, April 10 — Energy giant Shell today announced that it is leaving the joint project it was developing with Gazprom in Russia, following the Russian gas company’s decision to alter its configuration.

“Following Gazprom’s announcement on March 29 regarding the final development concept of Baltic LNG, we have decided to stop our involvement in this project,” the British-Dutch group said in a statement.

Baltic LNG project involved the construction of an LNG plant with the capacity of 10 million tonnes in the Ust-Luga port of Saint-Petersburg.

While it was initially a joint project, Gazprom published a press-release on March 29 that no longer mentioned Shell’s involvement.

In this statement, Gazprom said it “made a decision on the final configuration of the project” with a Russian group RusGazDobycha that will process ethane-containing gas and produce LNG.

Shell said this means “full integration between LNG and gas processing plant” which affects the partnership with Shell on the project for solely the LNG factory.

“We have a number of other ongoing projects with Gazprom... which are not impacted by this decision,” Shell said.

Shell and Gazprom cooperate in the massive Sakhalin 2 project on Russia’s Pacific coast, which is the first LNG facility in Rusisa.

They are also both involved in Moscow’s Nord Stream 2 project with annual capacity of 55 billion cubic metres, which aims to deliver Russian gas to Europe bypassing Ukraine. — AFP