Int’l lenders back $9.5b financing for Russian gas project

LONDON, Sept 19 (Arab News): International lenders have lined up about $9.5 billion in financial support for a Russian Arctic liquefied natural gas (LNG) project, a document seen by Reuters showed, even as such projects come under greater scrutiny over climate concerns.
The $21 billion project, which received final investment approval a year ago, is expected to be launched in 2023 and to reach its full capacity of almost 20 million tons per year in 2026.
While the energy industry touts natural gas as a cleaner alternative to coal or crude, it is a source of carbon emissions and critics say LNG projects are hard to reconcile with the transition to low-carbon economy envisaged in the Paris climate agreement and the EU's Green Deal economic plan.
The interest of international institutions, however, gives a boost for the Arctic LNG 2 development, led by Russian non-state company Novatek as Moscow's plans to raise its share in the global LNG market.
Among them is French state investment bank and credit agency Bpifrance, with an offer of $700 million in credit finance and Germany's Euler Hermes, with a covered facility of $300 million, the document said.
Alongside Bpifrance's support, the document said a number of other state-backed institutions are also expected to help fund the project including the China Development Bank, which is expected to offer a facility equivalent to $5 billion.