Russia Prepares for EU Transshipment Ban by Expanding LNG Carrier Fleet

Russia is preparing for the upcoming EU transshipment ban by increasing its fleet of LNG carriers. Starting in March 2025, EU export terminals will no longer accept Russian LNG, prompting the country to shift to ship-to-ship transfers.

To facilitate this, Russia is reportedly assembling a small fleet of vessels to transfer supercooled gas from the Yamal LNG project. Currently, specialized Arc7 ice-class vessels transport LNG through icy waters to European terminals, where it is often re-exported to other markets. In 2024, approximately 2,6 million tonnes of Russian LNG were exported through the EU in this manner, requiring around 35-40 ship-to-ship transfers to replace terminal capacity.

Tracking data shows over six LNG carriers operating between Murmansk and Novaya Zemlya, collectively covering extensive distances since the start of the year. This group includes both previously sanctioned “shadow fleet” vessels and those not currently subject to US or European sanctions.

All vessels belong to the “North” series, built by South Korea’s Hanwha Ocean. The fleet includes North Mountain, North Air, North Way, North Sky, North Moon, North Ocean, and North Light. The first four vessels are set to enter service in 2024 and were quickly sanctioned by the US State Department, along with their owner, White Fox Ship Management.

The latter three vessels are heading to Arctic waters following their deliveries in late 2024, with a fourth, North Valley, expected to arrive by the end of March. The Yamal LNG project typically relies on about a dozen STS transfers annually, and activity at the Kildin Island transfer site has been increasing. North Moon recently completed its first load, with other North-series vessels likely to follow. It remains uncertain whether Novatek, the project’s majority owner, will risk using already sanctioned vessels for LNG transport from the unaffected Yamal plant.

The Biden Administration has been focused on preventing Russia from expanding its transport capacity, sanctioning over a dozen LNG carriers, including the first four North-series vessels and the Yamal Arc7 carrier, Christophe de Margerie. It is unclear if this approach will continue under a potential Trump Administration or if Russia will be able to rebuild its LNG fleet.

In addition to the North-series vessels, many other shadow fleet or sanctioned LNG carriers are still operating globally. Vessels like Pioneer, Nova Energy, and East Energy are currently in or near Nakhodka Bay after loading product from Arctic LNG 2 this summer, while other sanctioned vessels, including Mulan and La Perouse, have been idling near the northern end of the Suez Canal and off the coast of Oman for weeks.