ByTsvetana Paraskova– Feb 12, 2025, 6:15 AM CST
The biggest Russian LNG developer and exporter, Novatek, saw revenues and earnings rise in 2024 from a year earlier as production increased, the company said on Wednesday.
Adjusted profit attributable to shareholders of PAO Novatek, excluding the effect of foreign exchange rates, rose by 4.6% to $5.9 billion (553.4 billion Russian rubles) in 2024.
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Revenues and core earnings, EBITDA, also increased last year compared to 2023, by 12.7% and 13.2%, respectively, said the Russian company.
However, net debt soared 15 times, and net cash provided by operating activities slumped by 17.6% compared to 2023, Novatek’s 2024 earnings release showed.
The company, developer of the Russian flagship Arctic LNG 2 project, has been hit by the Western sanctions.
Located in the Gydan Peninsula, Arctic LNG 2 was considered key to Russia’s efforts to boost its global LNG market share from 8% to 20% by 2030-2035.
But the project has come under intensifying sanctions from the United States, which have put off any buyers that were previously considering buying cargoes from Arctic LNG 2.
The project has seen months of delays after the initial U.S. sanctions in November 2023 upended the company’s plans for production start-up and export timelines.
In August 2024, the U.S. State Department intensified efforts to derail Arctic LNG 2 exports by targeting companies involved in the development of the project and vessels found to have loaded LNG from the facility.
The U.S. designated multiple companies related to Arctic LNG 2 to further disrupt the project’s ability to produce and export LNG, as well as the project’s ability to procure critical LNG carriers.
In September, reports emerged that Russia started shipping LNG from Arctic LNG 2 project—but not to customers.
The shipments were from the Arctic project to floating storage units either in Russia or in European waters, as potential customers are unwilling to buy LNG from the facility, which has seen tightened Western sanctions in the past months.
By Tsvetana Paraskova for Oilprice.com
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