TotalEnergies announced on Tuesday that it had initiated a force majeure process for Arctic LNG 2 due to US sanctions against Moscow, which will allow it not to have to take delivery of the volumes of liquefied natural gas (LNG) produced by the Russian project this year.

In November, the United States introduced sanctions against Arctic LNG 2, a key element of Russia's strategy in the global LNG market, where it aims to increase its market share from 8% to 20% by 2030.

"We have initiated the force majeure process in accordance with the contracts in force, and we will comply with the applicable sanctions regimes in accordance with our principles of action," TotalEnergies said in a statement to the press.

"As a result, no LNG offtake from Arctic LNG 2 by TotalEnergies is planned in 2024," the French group added.

TotalEnergies, which holds a 10% direct interest in Arctic LNG 2, had announced in 2022 its decision to stop recording proven reserves for the project, as well as a $4 billion provision linked to it, due to the uncertainties caused by European sanctions against Moscow linked to the war in Ukraine.

The daily Kommersant had reported at the end of December that the French group and the other foreign shareholders in Arctic LNG 2 - the Chinese state oil majors CNOOC Ltd and China National Petroleum Corp (CNPC), as well as a consortium made up of the Japanese Mitsui and Co and JOGMEC - had declared force majeure.

The project is controlled by Novatek, Russia's largest LNG producer, with a 60% stake.

According to two industry sources interviewed by Reuters, Arctic LNG 2 is scheduled to load its first tanker for Asia at the end of January, but volumes are expected to be low due to sanctions.

(Benjamin Mallet reports; edited by Nicolas Delame)