Russia’s largest independent natural gas producer Novatek said subsidiary Arctic LNG-1 plans to conduct a geological survey, which if it leads to exploration could create more supply to expand liquefied natural gas (LNG) exports.

The survey includes the Soletsko-Khanaveyskoye field, which is on the Gydan Peninsula in the Kara Sea north of Siberia, in the Yamal-Nenets Autonomous Region. The license area has an estimated 16 billion boe, including 2,183 billion cubic meters of natural gas, according to the Russian resource classification system. 

The Yamal-Nenets region accounts for around 80% of Russia’s gas production, and is the world’s largest gas producing area, representing 15% of global production. The new license area borders Novatek’s Trekhbugorniy and Gydanskiy areas on the Gydan Peninsula and may allow the company to create a resource base for its next LNG project with liquefaction trains at the Utrenniy terminal.

Novatek Chairman Leonid Mikhelson in April tried to persuade Russian governmental officials to support a long-term plan to build several LNG plants on the Yamal and Gydan peninsulas with a total production capacity of 140 million metric tons/year (mmty). However, state-run gas giant Gazprom has pushed back against the Novatek plan. 

Since Novatek’s 16.5 mmty Yamal LNG project became operational in 2017, the company has supplied several cargoes to the European gas market, creating competition for Gazprom’s gas pipeline monopoly on the European continent. 

Novatek signed a $3 billion agreement in June to sell its remaining 10% stake in the Arctic LNG-2 project to Japan Arctic LNG, a consortium of Tokyo-based Mitsui & Co and Japan Oil, Gas and Metals National Corp. Deals with Japan Arctic LNG and with two Chinese oil majors were finalized in July. Total SA, second only to Royal Dutch Shell plc in selling LNG, also holds a 10% interest in the Arctic LNG 2 project, which is slated to be commissioned by 2023. 

Arctic LNG-2, estimated to cost up to $22 billion, is to have three liquefaction/production trains with a total capacity of 19.8 mmty. 

Besides Russia’s LNG Sakhalin II and the Yamal project, the country also has several other large and mid-scale LNG projects planned or proposed. Some companies have also started to explore the feasibility of low capacity LNG plants in the country that would have annual capacity of around 1 mmty, according to the International Gas Union.