LNG vessel calls at Russia's Arctic LNG 2, points to LNG export restart

An LNG vessel has arrived at the Arctic LNG 2 export facility in northern Russia, a signal that loadings from the heavily-sanctioned project could be set to resume.

The Iris LNG vessel -- formerly called the North Sky -- reached Arctic LNG 2 on June 26, according to S&P Global Commodity Insights shipping data.

The North Sky was sanctioned by the US in August 2024 along with a number of other LNG vessels linked to the Arctic LNG 2 project as part of a crackdown by Washington against Russian energy exports.

The sanctions were imposed as Arctic LNG 2 began loading cargoes from its first train.

A number of cargoes were loaded from August until October last year, but the LNG struggled to find buyers amid international sanctions.

Instead, the first cargoes were offloaded into Russian storage facilities -- the Saam floating storage unit in Murmansk and the Koryak FSU in Russia's Far East.

The project's second train produced its first LNG in May, while the first train remained shut in with its LNG tanks full, according to a source close to the project.

The Arctic LNG 2 operating venture is led by Russia's Novatek, which has a 60% stake. Novatek did not respond to a request for comment June 27.

Plant capacity

The facility -- originally seen as a flagship of Russia's LNG sector -- is designed to have three trains, each with a capacity of 6.6 million mt/year, giving it a total capacity of 19.8 million mt/year.

It was initially planned for the first train to become operational in 2023, followed by a second train startup in 2024 and a third in 2026.

However, the startups of the first two trains were delayed by sanctions, with the start of the third train also likely to be later than planned.

Russia had lofty ambitions for its LNG sector, but has been impacted by sanctions against new developments.

Its main LNG export facility is the Novatek-operated Yamal LNG plant, which last year exported some 20.9 million mt of LNG, according to Commodity Insights data.

Russia is also home to the Gazprom-operated Sakhalin LNG plant, which supplied 10 million mt of LNG in 2024 to Japan, China and South Korea, the data showed.

Russia also has two other smaller LNG production facilities -- Portovaya LNG and Vysotsk LNG -- but US sanctions were imposed against the two projects with effect from February this year.

Northern Sea Route

Moscow was also hit by an EU ban on the transshipment of Russian LNG cargoes at EU ports, which took effect in March this year.

Before the ban, Yamal LNG cargoes could be transferred from specialized ice-breaker LNG vessels to conventional tankers for onward shipment to other markets, including in Asia, at EU ports.

Russia also has access to the Northern Sea Route in the summer months -- typically from late June until November -- enabling Arctic cargoes to be delivered directly to markets in Asia.

The first cargo making the journey so far in 2025 left Yamal LNG aboard the Georgiy Ushakov on June 17.

Commodity Insights shipping data showed the vessel moving southward in the Bering Strait as of June 27.

"The start of summer transits for Yamal LNG's cargoes via the Northern Sea Route to North Asia is bearish for JKM prices as it will bring in around 4-5 months of additional supply to the region," Eric Yep, principal analyst, First Take Gas at Commodity Insights, said.

Spot Asian LNG prices remain relatively high. The Platts JKM benchmark price for spot deliveries to northeast Asia was assessed on June 26 at $12.86/MMBtu.

So far in 2025, Russia has exported a total of 17.1 million mt of LNG, according to Commodity Insights data. That compares with exports of 33.4 million mt for the whole of 2024.

This year to date, the biggest buyers of Russian LNG have been France (3.3 million mt), Japan (3.1 million mt) and China (3 million mt).