Total seeks alternative funding for Russian project on sanctions
By Bloomberg
Total SA wants to have alternative financing by the middle of next year for a $27 billion Russian natural gas project, continuing its former CEO's support for developing energy production in the country despite international sanctions.
"We are putting in place financing in other currencies, mostly by Chinese and Russian lenders, and export credit agencies which are mostly European but not only," Patrick de La Chevardiere, chief financial officer of the Paris-based company, said on a conference call. "We are targeting by June 2015."
Total, which holds 20 percent of the Yamal liquefied natural gas project, is no longer counting on production starting in 2017 as originally planned. China National Petroleum Corp. owns a 20 percent stake, while the Russian company OAO Novatek holds a 60 percent share.
Former Chief Executive Officer Christophe de Margerie, who was killed in a plane crash last week, was committed to the development even after U.S. and European put in place sanctions on Russia because of its role in a separatist movement in Ukraine. Designed to produce LNG on the Yamal Peninsula above the Arctic Circle, the project is central to Total's plans to boost output and Russia's bid to export more LNG.
Total maintains an 18.2 percent stake in Novatek, de La Chevardiere said. Before the Ukraine conflict erupted, Total was planning to increase the holding to as much as 19.4 percent.