Russia Insider...
West throws a spanner in the works, the Chinese step in, the project proceeds
Originally appeared at Reuters
Russia's Yamal liquefied natural gas (LNG) project has signed loan agreements with Chinese banks worth over $12 billion, it said on Friday, circumventing Western sanctions in a major boost for the project led by gas producer Novatek.
Talks with European and Chinese lenders had dragged on for months, complicated by Western sanctions against Novatek and its major shareholder Gennady Timchenko, a friend of Russian President Vladimir Putin, over Moscow's role in the Ukraine crisis.
With the deal, Yamal LNG's external financing needs, seen at $18-$19 billion, are fully covered.
The project has already secured state funds worth 150 billion roubles ($2.3 billion) from a rainy day fund and 3.6 billion euros from state-controlled lender Sberbank and Gazprombank.
Yamal LNG's future had been in jeopardy due to the lack of access to Western capital markets. Plunging oil prices, the benchmark for gas prices, had also clouded its prospects.
Several other global LNG projects, notably the proposed $30 billion Browse floating LNG project off Australia, have been shelved due to global oversupply.
"The project is progressing in accordance with the approved schedule. With the first train of the LNG plant 65 percent complete we are currently at the most intensive phase of construction and assembly works," Yevgeny Kot, director general of Yamal LNG, said in a statement.
'PUTIN'S WIN'
The loan deals, the third-largest in Russian corporate history, are likely to be presented in Russia as a victory over what are seen as Western attempts to curb Russia's energy expansion to punish it for its role in the Ukraine crisis.
They are also in line with Russia's "Eastwards Pivot", a policy of forging closer political and economic ties with Asia's biggest powerhouses, such as China, to compensate for poorer relations with the West.
Earlier this decade, Kremlin energy champion Rosneft , raised over $30 billion in Western loans to acquire Anglo-Russian oil firm TNK-BP, while oil pipeline monopoly Transneft jointly with Rosneft got $25 billion from Chinese banks to build a pipeline to Asia.
The new funds will help the $27 billion Yamal LNG project to start producing liquefied gas next year. Three LNG production lines are envisaged, each with an annual capacity of 5.5 million tonnes.
About 95 percent of future production has been pre-sold.
Yamal LNG, the world's most northerly project of its kind, is located beyond the Arctic circle. The gas, frozen at a temperature of around minus 160 Celsius (minus 320 Fahrenheit)will be shipped to global markets including China.
ussia wants to double its share in the global LNG market by 2020 from 4.5 percent currently. Kremlin-controlled Gazprom and Royal Dutch Shell are key shareholders in Russia's only LNG plant, located on the Pacific island of Sakhalin. It produces over 10 million tonnes of LNG per year.
The 15-year loan deals of 9.3 billion euros ($10.6 billion) and 9.8 billion yuan ($1.5 billion) were signed with Export-Import Bank of China and the China Development Bank.
The euro-denominated part of the loan is being made at 3.3 percent above the European benchmark 6-month EURIBOR rate at the construction stage and 3.55 percent above thereafter, Yamal LNG said. The renminbi loan is being made at 3.3 percent above China's 6-month SHIBOR benchmark, and then 3.55 percent above.
Novatek holds 50.1 percent of Yamal LNG. France's Total and China National Petroleum Corp control 20 percent each while China's Silk Road Fund owns 9.9 percent.
($1 = 0.8790 euros)
($1 = 6.4840 Chinese yuan renminbi)
($1 = 64.3000 roubles)
Poster Comment:
Seimisi/ Robert Stone • Russia have to start teaching their kids from kindergarten upwards on how the jewish-controlled USA and EU are sabotaging their trade with the rest of the world in order for Russia to disintegrate so they can go in and steal all their resources.You have no other option or you will lose your Nationhood to the jewery world order.+12
Tan • The Chinese have no choice but to help the Russians.... because if Russia goes under, they are next... For better or for worse, the Chinese have to back up the Russians... Because they know the ultimate objective of the West is to split up Russia and China and take over the resources of these two countries.
Western banks, which have been forced to forego such useful and profitable investments as this, need not worry about where their income will come from. They can rely on the US Treasury to go on printing intrinsically valuable dollars to hand over to the banks. And obviously an economy based on ever-growing mountains of government paper is just as prosperous and healthy as an economy based on oil, gas, and other useful commodities. It's really funny that American politicians like to sneer at Russia as "a gas station masquerading as a state". Whereas the USA is increasingly a bank masquerading as a state - and a bank with no economy is conspicuously useless. "Let them eat cash".+4
Rocky Racoon • aaaaaaaaaaahhhhhhhhhhhh terrorists, what difference does it make at this point. You had sex with that woman Bill, humiliated me in front of the entire country. Only one way I will stand by you. I am President after Bush or else! Got it! bezzlebe bug bimg oshenh salad salute salam. Gobbygook. Brez, What are we going to tell our hedge fund managers now with all your brilliant plans to lower oil and gas prices???????? We went long on Qatar and Ukraine. Not even Soros can save our butts. Our Foundation is shot! And talk about shot that AG is getting to pushy over those emails. Somebody has to go and it sure as heck isn't going to be me! RR
tjoes/Rocky Racoon • Are you sure she wasn't part of the plan to put bait in front of her hubby and then help them use it for leveraging Bill to attack Iraq? Then they put the 7 country in 5 year plan in under cover of outing him. They knew he would lie about it...he had a reputation for sex escapades that any intel worth salt would know. Think about it...she helped set him up to be extorted....and has been handsomely paid back for it.
Isabella/ Lord Lemur • It is also best to deal with the state which makes it clear that it is acting unashamedly in it's own interest, as indeed you should be when you negotiate for your state. This way both partners know exactly where they are "coming from" and act out of respect for each other.
Lord Lemur /Isabella • Too right. That's why I think Trump and Putin could make deals that lead to real peace. They both want what's best for their people, and there's nothing to be gained from two fraternal cultures permanently at odds with each other. "Some say the Russians won’t be reasonable. I intend to find out. If we can’t make a deal under my administration, a deal that’s great — not good, great — for America, but also good for Russia, then we will quickly walk from the table. It’s as simple as that. We’re going to find out." And we already know Trump welcomes Russian input in Syria, opposes destabilization like Putin, and could care less about Ukraine. So with those things out the way, what will remain an outstanding dispute? Maybe just missile defence.+2
Isabella /Lord Lemur • I think so. Another reason I like Trump - like Putin, he's not a professional "politician". They both started out in totally different spheres and gravitated to politics in the "infiltrate then liquidate" model. And such as these have a pretty good probability of bringing a different more honest mind set to the job; of knowing the cold hard facts of reality and that ideology is the worst thing to bring to rulership, and the only way to "get things done" is to quit the backroom deals, the backstabbing and stroking, and just get on the with the job, with both eyes firmly fixed on reality. It's a wild hope, but right now, about the best we've got. Sadly, I think the US Electoral college has other ideas!!. Bought and paid for by the AngloZionist bankers and Neo-Con madmen.
Lord Lemur/ Isabella • / yep. Trump wants to live and let live
http://katehon.com/article/tru...
Nightcrawler136/ Lord Lemur • I fear the game is rigged in Clinton's favour!