Global oil and gas company Shell has decided to leave the 10 Mt/year Baltic LNG project in Ust-Luga near Saint Petersburg (Russia), developed in partnership with Gazprom, after the Russian gas giant recently decided to integrate the LNG project into a large gas and LNG complex worth more than RUB 700bn (US$11bn) and to set up a 50-50 special-purpose company, RusKhimAlyans, with RusGazDobycha (National Chemical Group). Shell, as other Western companies, was also under pressure from sanctions imposed by the United States against Russia. For Gazprom, Shell's exit from the LNG project could mean limited access to Shell’s technology as well as difficulties to finance the project.
In 2016, Shell signed an MoU with Gazprom under the terms of which Shell could take 49% of the project, and the companies signed an additional HoA to set up a JV for the project in June 2017. The project, estimated at US$7.1bn, was expected to be commissioned in 2023.
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