After oil, Russia is also building a shadow fleet for transporting LNG: North Korea gets record permission to deploy decommissioned ships

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Puzzle pieces fit together Tithe of ships

After invading Ukraine and coming under Western sanctions, Russia created a shadow fleet to ship its oil around the world. Now, there’s growing evidence that Moscow has begun doing the same with liquefied natural gas (LNG). TASR reported this based on a report from Bloomberg.

photo: SITA/AP, Ramil Siddikov

On Thursday, July 20, Russian President Vladimir Putin launched the first production line of gravity LNG technology at the Arctic LNG project in the village of Belokamenka in the Murmansk region, about 1,700 km north of Moscow. 2023.

Natural gas is key to filling Russia’s coffers and financing the war in Ukraine. However, that requires taking a bigger share of the global liquefied natural gas market as Moscow has slashed once-lucrative pipeline gas supplies to Europe.

New restrictions by the European Union (EU) are hampering Russia’s plans to increase liquefied natural gas exports. Among other things, they will prohibit investments and the provision of goods, technology and services for the completion of projects in the Russian LNG sector. Russian ships’ access to European ports is also restricted, so they will not be able to use EU facilities to transfer LNG to other third-country ships.

According to Equasis, ownership of at least eight ships has been transferred to little-known Dubai companies in the past three months. Moscow has given permission for four ships to travel through Russian Arctic waters this summer.

Puzzle pieces fit together

This is strikingly similar to the practice of creating a shadow tanker fleet, including the use of opaque companies and older vessels that are typically decommissioned.

The insurers of at least three tankers are listed as “unknown” in the International Maritime Organization’s database, another characteristic of shadow fleet vessels.

“There are multiple indications that Russia is trying to build up a shadow LNG fleet,” said Malte Humpert, founder of the Arctic Institute, a Washington think tank.

The purchase of older vessels, the transfer of ships to Dubai entities and the record number of Northern Sea Route permits indicate that “the pieces of the shadow fleet puzzle are coming together.”

Tithe of ships

However, transporting LNG is more complex than shipping crude oil. Refrigerated and liquefied natural gas requires more skilled crews and more sophisticated technology, so there are fewer ships and they are easier to track using satellite data. While there are 7,500 tankers of varying sizes sailing the world’s seas, the LNG fleet is less than one-tenth that number.

The maritime graveyard is filling up: Ukraine sends another Russian ship to the depths of the Black Sea

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In the case of oil, the usual way to conceal its origin is to pump it from one ship to another in the open sea, but with liquefied natural gas, the situation is much more complicated. This is why Russia has so far used European ports for this exercise. However, starting next March, this will no longer be possible.

Russia, currently the fourth-largest exporter of liquefied natural gas, has every reason to continue seeking alternative routes to global markets. However, once a network that violates sanctions is established, it will become a target for Western authorities. Bloomberg added that the game is similar to a cat-and-mouse game.