Why is US Striving to 'Kill' Russia’s Arctic LNG-2 Project?

US Assistant Secretary of State for Energy Resources Geoffrey Pyatt earlier announced Washington’s plans to torpedo the Arctic LNG 2 project through sanctions coordinated with the Group of Seven partners and other allies.

The US State Department has announced sanctions against four companies and 16 vessels linked to the Arctic LNG 2 gas liquefaction project by the Russian company Novatek.

Two of the companies that have been sanctioned are foreign-based.

The sanctions aim "to further promote accountability for entities providing material support to […] the operator of the Arctic LNG 2 project," the State Department said in a statement.

The US is making herculean efforts to torpedo the project first and foremost because the two countries remain "direct competitors" in this field, Stanislav Mitrakhovich, a leading expert of the National Energy Security Fund and the Financial University with the Russian government, said in an interview with Sputnik.

"Both Russia and the United States produce liquefied natural gas (LNG). In this sense, the two are even bigger competitors than in the oil market. American oil can replace Russian crude somehow, but as for LNG, America plans to produce it in very large quantities. In the next ten years, the US is due to introduce new capacities to liquefy natural gas," Mitrakhovich said.

He recalled that production has so far been suspended at the gas field that feeds the Arctic LNG-2 project, and that “Americans are trying to delay the possibility of reviving the project for as long as possible."

At the same time, the expert made it clear that the US is unable "to completely kill Russia’s LNG industry."

As long as Russia "has its own basic feature in the form of a scientific and technical base, there will be opportunities for development and they will be seized," according to Mitrakhovich.

"Russia is supported by China, which is quite obvious. Because if Russia were to lose this confrontation, China would face the West alone. China doesn't need that. This is an absolutely fundamental factor. And with the help of this, I think, the problem will be solved," Mitrakhovich pointed out.

When it comes to money, Russia benefits more from oil exports, which "we were able to redirect very effectively," a process that takes time, per the expert.

"Money is coming in mainly from oil exports. We have redirected the oil, but it’s not possible to replace it quickly. Export is underway. The money we have received is used, among other things, for technological re-equipment, import substitution, and creation of new production facilities," Mitrakhovich concluded.

Arctic LNG-2 is Russia's third LNG project. According to expectations, once the endeavor is completed, it will encompass three liquefaction trains producing a total of 19.8 million tons per annum (MTPA) of LNG and up to 1.6 MTPA of stable gas condensate (SGC).