I finish.  There will be no Russian gas or chemical giant in the Baltic Sea

The end of a huge Russian chemical project could cost European banks dearly. The Arbitration Court of St. Petersburg and the Leningrad Region decided to seize the assets of three enterprises. This is the latest blow to plans to build a large chemical complex.

  • The decision to seize bank assets ends the chances of completing the large investment.
  • Thanks to this, the Russians wanted to conquer the European Union chemicals market.
  • Without foreign technology, investment is not possible.

According to the plan of the so-called Baltic Chemical Complex was supposed to be the largest chemical plant in the Baltic Sea. Project owners are Gazprom and RusGazDobycie. The idea was simple. Gas and oil produced in Russia were to be transported to Ust-Luga – the site of the processing complex – and there they were processed and converted into chemicals.

The plans were subject to an attack by Putin’s forces on Ukraine

The plant itself was scheduled to become the most powerful in terms of gas processing in Russia and the largest in terms of LNG production in the Baltic Sea.

The complex was to process 45 billion cubic meters of gas per year (almost three times the annual consumption of this raw material in Poland). It consists of two parts – liquefied gas production and chemicals. Annual LNG production is expected to reach 13 million tons. The first ton of liquefied natural gas was scheduled to be produced – according to Russian plans – in 2024.

The constructed facilities were scheduled to produce up to 3.8 million tons of the ethane fraction, up to 2.4 million tons of the liquefied petroleum gas and 0.2 million tons of the pentane-hexane fraction. The remaining natural gas after processing (about 19 billion cubic meters) will go to Gazprom’s transportation system.

The complex was supposed to allow the Russians to seize a significant part of the petrochemical market in Europe.

The problem is that the factory was never built. The vast majority of devices were of Western technology, with the giant Linde at the forefront.

As a result of the attack on Ukraine, Russia was subjected to sanctions. Moscow’s plans collapsed.

Salares Norte Mine

The Russians stole assets from the banks because they couldn’t rob Lindy

RusChemAlliance – the company responsible for investing on the Russian side – believed from the beginning that Linde was entirely responsible for stopping the investment. They stated that the Germans’ decision to suspend participation in the work was unjustified and exposed Russian partners to losses.

Germany explained the sanctions and fears of exposure to them in the event of further cooperation.

Following the court decision, the Russians decided to seize the German company’s assets last year, although this was highly questionable from a legal standpoint. But according to Moscow’s calculations, these losses did not cover all the losses.

At the end of last week, the Arbitration Court of St. Petersburg and the Leningrad Region took interim measures in continuing the proceedings in this case. He decided to seize the assets of the following banks: UniCredit, DB and Commerzbank. These are assets worth a total of €795 million.

According to the Russians, this is a type of compensation. The Russians explained that the guarantor banks refused to fulfill their obligations because the alleged payment to the Russian company might violate European sanctions.

However, Moscow’s decision was rated disastrous by analysts. In their opinion, there is currently no opportunity to complete the investment. In practical terms, this means that between 5 and 7 billion euros could have been wasted.

Moreover, even in the future, it will be difficult for the company to find a technology supplier.

Vladimir Putin announced that Moscow is considering increasing oil supplies to the Chinese market

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