Under the terms of the deal, Total will acquire 10% stake in the Arctic LNG 2 project as well as have a chance to acquire additionally up to 5% if Novatek decides to decrease its stake to 60%.

Total said in a statement: “Taking account of Total’s approximate 19% stake in Novatek and Novatek’s intention to retain 60% of the project, the Group’s overall economic interest in this new LNG project will be approximately 21.5%.”

Additionally, the Novatek agreed to provide Total an option to acquire a 10 to 15% interest in Novatek’s future LNG projects in Yamal and Gydan.

Total chairman and CEO Patrick Pouyanné said: “Total is delighted to be part of this new world class LNG project alongside its partner Novatek, leveraging the positive experience acquired in the successful Yamal LNG project.

“This project fits into our strategic partnership with Novatek and also with our sustained commitment to contribute to developing the vast gas resources in Russia’s far north which will primarily be destined for the strongly growing Asian market.

“Arctic LNG 2 will contribute to our strategy of growth in LNG by developing competitive projects based on giant low costs resources.”

The Arctic LNG 2 will have a production capacity of approximately 19.8 million tons per year (Mt/year), or 535,000 barrels of oil equivalent per day (boe/d).

Expected to unlock more than 7 billion boe of hydrocarbons’ resources in the onshore Utrenneye gas and condensate field, the project involves construction of three LNG trains using gravity-based structure (GBS) platforms. Each of the trains will have a capacity of 6.6 million tons per annum.

Novatek plans to make investment decision on the Arctic LNG 2 in 2019 and begin production from first train by the end of 2023.

Production from the project will be delivered to international markets by a fleet of ice-class LNG carriers.