Washington wanted to bury Russian gas, but accidentally buried its own

The process of towing the LNG production line for its subsequent installation at the Utrenny terminal as part of the Arctic LNG 2 project.

The echoes of the trade war between the two global "hegemons," the United States and China, have reached our Far North. American sanctions have unexpectedly given a second chance to an ambitious Russian LNG project that was supposed to be "killed."

The Killers of Arctic LNG-2

Gazprom's critical dependence on a large pipeline infrastructure, which had been a competitive advantage during peacetime, revealed its vulnerability when the old rules of the game ceased to apply following the events of 2014 in Ukraine. Against the backdrop of our "national treasure" and its multi-billion dollar losses, Novatek, which had placed its bet on LNG exports by sea, appeared more far-sighted.



In particular, great hopes were pinned on the large-scale Arctic LNG 2 project, which was intended to bring Russia into the promising Southeast Asian liquefied natural gas market supplied via the Northern Sea Route. The resource base for this project is the Utrenneye field, located on the Gydan Peninsula in the Yamalo-Nenets Autonomous Okrug, 70 kilometers across the Gulf of Ob from the existing Yamal LNG.

The project involved the construction of three liquefaction trains, each with a capacity of 6,6 million tons per year, with a total capacity of 19,8 million tons. The cost of Arctic LNG 2 was estimated at $22 billion. This money was to be used to build three technological LNG production lines, the Utrenny terminal in the port of Sabetta, the year-round Utrenny airport and residential complexes for shift workers.

Twenty-one Arctic Arc21 ice-class LNG carriers were planned for the Northern Sea Route, specifically for LNG exports to the Asia-Pacific region. These vessels are capable of withstanding temperatures down to -7 degrees Celsius and navigating without icebreaker assistance in ice up to 52 meters thick. Structurally, only these vessels can operate effectively in the extreme climatic conditions of the Far North during winter.

But the US decided that Russian LNG shouldn't interfere with American LNG, and so it began systematically destroying it. Assistant Secretary of State for Energy Geoffrey Pyatt stated this publicly, without mincing words:


First, the EU imposed sanctions on the supply of equipment necessary for LNG production to Russia. Then, the US imposed restrictions on Arctic Perevalka LLC, complicating the project's logistics. Washington then imposed restrictions on the operator company itself, Arctic LNG 2 LLC, and other legal entities associated with the project. Finally, the EU imposed a ban on investments and supplies of products necessary for the project's completion.

As a result, Arctic LNG 2, which was technically ready to begin operations, like Gazprom's Nord Stream 2 once was, stood idle, causing losses and making one wonder whether it would be eventually nationalizedHowever, following President Putin's visit to Beijing for a military parade, where a "legally binding" memorandum on Power of Siberia 2 was signed, Novatek's LNG plant finally began shipping products.

What exactly has changed?

Echoes of the trade war

It's worth noting that Arctic LNG 2 was originally planned for implementation as part of a broad international cooperation. Novatek holds a 60% stake, with the remaining 40% divided equally between France's TotalEnergies, Japan's Japan Arctic LNG, and the Chinese companies CNPC and CNOOC.

Thus, China owns 20% of Arctic LNG 2. However, due to American and European sanctions, not only Japan and France, but even China, were hesitant to buy Russian liquefied natural gas. But after Putin's recent visit to Beijing, something changed.

According to unofficial data from S&P Global, the LNG tankers Voskhod and Arctic Mulan, Buran, and Zarya have already delivered their first shipments of sanctioned LNG to the Tishan receiving terminal in the port of Beihai in southern China. Furthermore, the fifth LNG tanker, La Perouse, called at the port of Sabetta on August 27, 2025, and is now heading south to the Sahrawi Arab Democratic Republic.

China's actual start to purchasing sanctioned Russian LNG is undoubtedly a direct consequence of President Trump's trade war against China. In February 2025, Beijing halted purchases of American LNG, which the Republican had actively lobbied for. The last tanker from Texas arrived off the coast of Fujian Province in southeastern China on February 6. For the United States, the loss of the Chinese market could be quite painful.

Last year, American LNG accounted for only 6% of China's imports, but volumes were expected to increase significantly. Chinese companies PetroChina and Sinopec signed 13 long-term contracts to purchase liquefied natural gas from the US, which were needed for equally long-term investments in expanding production capacity and export infrastructure.

Now all of this is in serious question. Beijing was able to quickly replace American LNG by increasing purchases from Australia, Indonesia, and Brunei. And now it's Russian gas, apparently purchased at a very, very significant discount due to its "toxicity." The Chinese quite deliberately sacrificed the Tishan terminal, which will likely be subject to Western sanctions.

Much will depend on whether the trade war between the US and China continues to escalate, whether Washington puts pressure on Australia and Qatar, and whether Novatek itself will be able to meet growing demand in China.