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Cosco Shipping, Sovcomflot, Novatek and Silk Road Fund in Arctic LNG shipping venture

Cosco Shipping, Sovcomflot, Novatek and Silk Road Fund have inked an agreement to set up and Arctic shipping joint venture to manage icebreaking LNG carriers.

The agreement to establish the Maritime Arctic Transport (MArT) joint venture was signed at the St. Petersburg International Economic Forum.

The joint venture will focus on managing Arctic ice-class vessels, both existing and new ships, for Novatek LNG projects including Yamal LNG and Arctic LNG 2. The joint venture will cover shipping fron  Arctic zone of the Russian Federation to the Asia-Pacific region, as well as organising transit cargo traffic along the Northern Sea Route between Asia and Western Europe.

The agreement was signed by: Sergey Frank, president and ceo of Sovcomflot; Leonid Mikhelson, chairman of Novatek ; Xui Lizhong, chairman of Cosco Shipping Corporation; and Wang Yanzhi, president of the Silk Road Fund.

“The agreement represents an important milestone in developing the transportation of LNG produced by our Arctic projects along the Northern Sea Route,” said Novatek's Mikhelson. “The development of MArT will facilitate the rapid transformation of the Northern Sea Route into a global and commercially effective transportation corridor between the Pacific and Atlantic basins, as well as in the implementation of the decision made by the leadership of the Russian Federation to increase Northern Sea Route annual cargo traffic to 80 million tons in 2024.

The joint venture shipping agreement between Russian and Chinese interests came as Novatek announced it had inked share sale agreements with both CNOOC and China National Petroleum Corp (CNPC) for 10% stakes in the Arctic LNG 2 project.

Sergey Frank, president and ceo of Sovcomflot, said: "The sheer scale and level of technical complexity of the new international project to provide safe, year-round, transportation for LNG across the Northern Sea Route have required the combination of a whole range of intellectual, technological, human and financial resources, from leading Russian and Chinese organisations and businesses.”

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