Russia's Arctic LNG Competitive Despite Price Rout, Novatek Says
- Yamal LNG production costs 5 times lower than in U.S.: Novatek
- Lower production costs offset higher transportation expenses
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Russia’s Arctic Yamal LNG project will be able to compete with rivals in Australia and the U.S., even after energy prices plummeted to their lowest in more than a decade, according to its main owner.
The gas for the project costs less than $0.60 per million British thermal units, compared with $5 to $6 at some plants in Australia and $3 to $3.50 U.S. plants would pay on local markets, Leonid Mikhelson, the billionaire head and shareholder of Russia’s Novatek OJSC, told reporters at the World Economic Forum in Davos, Switzerland. That will help offset higher transportation expenses for Yamal LNG, set to start in 2017, following the ruble’s weakening to its lowest level on record.