X Close

World

Published: Wednesday July 30, 2014 MYT 10:20:02 PM
Updated: Wednesday July 30, 2014 MYT 10:21:12 PM

Russia's Novatek says assessing sanctions effect on joint projects

MOSCOW (Reuters) - Russia's second largest natural gas producer Novatek said on Wednesday it was assessing the impact of U.S. sanctions on the financing of joint investment projects.

In its quarterly report, it also said that net profit surged in April-June - before the sanctions were imposed - thanks to the launch of its processing complex in the Baltic Sea.

The company repeated that its key projects would go ahead despite sanctions imposed by Washington over Moscow's actions in Ukraine. It also said that the company had sufficient liquidity "to adequately fund its core oil and gas business operations".

The sanctions have limited the company's access to Western funds, especially for its $27 billion (15.94 billion pounds) liquefied natural gas project in the Russian Arctic which it is working on with France's Total and China's CNPC.

"Management will continue to closely monitor the economic and political environment in Russia and the world community, as well as the domestic and international capital markets to determine if any further corrective and/or preventive measures are required to sustain and grow our business," the company said in a statement.

Total owned 18 percent of Novatek's shares at the end of June, and said earlier on Wednesday it had stopped buying them when a Malaysian airliner was shot down over Ukraine earlier this month.

Novatek said its second-quarter net profit almost tripled year-on-year, beating market expectations because of an increase in liquids production on the back of launching the Ust-Luga complex in the Baltic Sea.

The company, co-owned by Gennady Timchenko, who is also under U.S. sanctions, said net profit reached 31.95 billion roubles ($896 million), above the average forecast of 27.8 billion roubles in a Reuters poll.

Revenues grew 52 percent, to 88.4 billion roubles, the company said. Analysts had expected rising sales of liquids, such as gas condensate, to drive revenues 50 percent higher to 86.8 billion roubles.

(Reporting by Vladimir Soldatkin, editing by Thomas Grove and Elizabeth Piper)

advertisement

Most Viewed

advertisement

advertisement