NOVATEK Risk Report

🛡️ financial & liquidity

Novatek is navigating various financial dynamics with a mixture of opportunities and risks. The company has been actively involved in mergers and acquisitions, seeking to broaden its reach and fortify its financial position. However, financial risks still persist, particularly in relation to sanctions and market conditions.

• Novatek experienced a notable growth in net profit to $5.2 billion for the year 2024, as reported on 🗓 February 12, 2025.
• In a significant move, Novatek acquired Shell's stake in Sakhalin-2 for $1.16 billion on 🗓 April 12, 2023.
• TotalEnergies announced a $3.7 billion impairment related to Novatek 🗓 December 9, 2022, heightening financial risk awareness.
• Ukraine imposed sanctions on Novatek 🗓 May 3, 2025, echoing broader geopolitical tensions that might affect financial inflows.
• The company indicated its expectation for a rebound in revenue with focus on OLED chips by 🗓 November 7, 2024.

⚖️ legal & regulatory

Novatek is under significant legal scrutiny due to geopolitical sanctions. The sanctions pose critical challenges to the company's market participation and expansion, affecting regulatory compliance and strategic operations.

• Sanctions have curbed Russia’s Arctic LNG 2 export potential, confirmed 🗓 May 23, 2025, due to a shortage of tankers.
• The EU imposed sanctions on Novatek-related gas carriers, restricting movement through European waters 🗓 May 21, 2025.
• Novatek was actively lobbying to ease US sanctions as reported on 🗓 December 13, 2024, suggesting potential regulatory negotiations.
• Legal compliance challenges arose with allegations of Novatek’s involvement in a ‘shadow fleet,’ despite official denials 🗓 September 16, 2024.
• Sanctions led Novatek to recommend a limited dividend growth 🗓 March 12, 2025.

🏗️ operational & business continuity

Operational continuity for Novatek faces multi-faceted risks, particularly from sanctions and infrastructural challenges. These result in halted projects and regulatory pressures affecting output and strategic objectives.

• A fire incident led Novatek to suspend operations at its Baltic Sea terminal as of 🗓 January 21, 2024.
• Sanctions caused Novatek to halt two major LNG projects, noted on 🗓 September 23, 2024, reflecting significant operational risks.
• Arctic LNG 2 faced supply interruptions due to sanctioned fleets and lack of tankers 🗓 April 2, 2024, complicating business continuity.
• Novatek announced suspension notices for the Arctic LNG 2 project related to force majeure conditions 🗓 December 21, 2023.
• Reports indicate the Arctic LNG 2 operations in non-active status as of 🗓 October 28, 2024.

📜 innovation & r&d

Despite external pressures, Novatek is pursuing innovations with a notable focus on LNG technologies. The company is attempting to advance its capabilities, although success is intermingled with external sanctions.

• Novatek and Natcar's partnership, as of 🗓 June 23, 2025, to boost LNG fueling indicates an innovative leap.
• As per 🗓 June 20, 2025, Novatek's move into LNG trucking exhibits proactive steps in innovation channels despite overarching sanctions.
• On 🗓 August 19, 2024, Novatek delivered an Arctic 2 LNG GBS indicating forward momentum in LNG tech implementation.
• Linkages with UAE to secure key technologies for Arctic projects were confirmed 🗓 October 17, 2022.