Novatek, also known as PAO Novatek, is a prominent Russian natural gas producer that focuses on exploring, producing, processing, and marketing natural gas and liquid hydrocarbons. Founded in 1994, Novatek has quickly become one of the largest independent natural gas producers in Russia and worldwide. Based in Moscow, the company operates in various regions in Russia, including the Yamal-Nenets Autonomous Region, which is home to one of the most abundant natural gas fields in the world.
Novatek’s main goal is to develop the Yamal Peninsula, a crucial area for its operations. The company’s flagship project, the Yamal LNG project, is a partnership with major international companies such as TotalEnergies from France and CNPC from China.
This project aims to tap into the extensive natural gas resources in the Yamal region, process them into liquefied natural gas, and export them to global markets. The Yamal LNG project has become one of the largest and most ambitious liquefied natural gas projects in the world, significantly enhancing Russia’s position in the international LNG market.
Apart from Yamal LNG, Novatek has been proactively broadening its footprint in the liquefied natural gas industry via diverse initiatives and collaborations. The business has been investing in the construction of new infrastructure and LNG facilities and is renowned for its creative use of liquefaction technology. In order to diversify its revenue sources and improve its competitiveness in the global energy market, Novatek has also been looking into opportunities in downstream industries, such as petrochemicals.
Novatek has proven to be resilient and adaptable in navigating the challenging terrain of the energy industry, even in the face of obstacles like geopolitical tensions and regulatory uncertainties. Due to its dedication to sustainable development, operational excellence, and technological innovation, the company has established itself as a major player in the global energy transition. Novatek is still a major player in determining the direction of the natural gas sector and propelling economic growth in Russia and abroad with its aggressive expansion plans and astute investments.
The brain behind this successful venture is 68-year-old Leonid Mikhelson, Russian-Israeli billionaire businessman, CEO, chairman and major shareholder of the company.
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Who is Leonid Mikhelson?
- Leonid Mikhelson was born on 11 August, 1955 in the Russian city of Kaspiysk
- He completed his graduation in Industrial Civil Engineering from the Samara Institute of Civil Engineering in 1977
- After his graduation, Leonid Mikhelson started working as a foreman at a construction and assembling company in the Tyumen area of Siberia
- He was appointed as a Chief Engineer of Ryazantruboprovodstroy in 1985, and in 1987, he became General Director of Kuibishevtruboprovodstroy, which was renamed NOVA in 1994
- The same year, Leonid Mikhelson then became General Director of its holding company, Novafinivest, which later became known as Novatek
- He was Chairman of the Board of Directors for OAO Stroytransgas and OOO Art Finance, from 2008 until 2010
- Other than being the director of companies, Leonid Mikhelson owns 57.5% interest in Sibur
- He also holds a 25% stake in Novatek, and he also owns a megayacht, Pacific
- Leonid Mikhelson is the founder of the V-A-C Foundation, which supports modern Russian art and maintains connections with the Tate Museums in the United Kingdom, the New Museum in New York, and the Whitechapel Gallery in London
- In 2012, he was listed as the second-richest Russian in several articles including Bloomberg
- According to Forbes, as of 2024, Leonid Mikhelson’s net worth is around 2,900 crores USD
Novatek Sets Up China Office
Meanwhile, Novatek is assembling a new team in China to investigate marketing the fuel, despite US sanctions impeding plans for exports from its new, multibillion-dollar Arctic project. The action demonstrates how Russian energy companies have continued to shift their focus to Asia, particularly, China, since the conflict in Ukraine closed off their access to European markets.
Following the imposition of US sanctions, Novatek may be able to find buyers for Arctic LNG 2, its most recent LNG project, with the assistance of a China operation. Experts say that Novatek, the biggest LNG producer in Russia, has been assembling a business development and marketing team in Beijing in recent months.
US sanctions were imposed in November 2023 on Arctic LNG 2, a project that was supposed to begin operations in 2024 as part of Russia’s goal to become the world’s leading supplier of LNG. Shipments would not be delivered, as advised by Novatek and its partners, including TotalEnergies of France, to China’s Shenergy Group, Zhejiang Energy, and Spain’s Repsol.