Ukraine designates Belgian gas company Fluxys as 'international sponsor of war'

Elsa Court, The Kyiv Independent news desk
·2 min read
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Belgian gas company Fluxys has been added to the list of "international sponsors of war" for its involvement in the Russian liquefied natural gas (LNG) trade, Ukraine's National Agency on Corruption Prevention (NACP) announced on Nov. 30.

Ukraine added Fluxys to its list for its role in boosting Russia's revenues by providing "storage and transshipment facilities" for Russian LNG at its terminal in Zeebrugge" in Belgium, the NACP said.

"At least a third of the Russian budget goes to war. Fluxys' services help Russia replenish it," Oleksandr Novikov, the head of the NACP, said in a statement.

Russia expects to receive up to $874 million in export tax revenues from the transshipment of LNG in Zeebrugge in 2023, according to the NACP.

Fluxys signed a 20-year contract with Russian company Yamal LNG in March 2015 for the transshipment of up to 8 million tons of LNG per year from Zeebrugge.

The contract supports Russian deliveries of LNG from the Yamal Peninsular to buyers worldwide when the Northern Sea Route is frozen during the winter months.

Arctic tankers deliver the LNG to Zeebrugge, where the gas is transferred to a conventional tanker that sails to Asian ports via the Suez Canal, freeing the Arctic tankers to return to Russia.

The largest shareholder of Yamal LNG is Russian gas company Novatek, Russia’s second-largest natural gas producer in Russia after the state-owned gas company Gazprom.

Novatek's owners are the oligarchs Leonid Mikhelson and Gennady Timchenko, who are "members of Vladimir Putin’s inner circle," the NACP said.

Yamal LNG also has a contract with SEFE, a German state-owned company. SEFE said in October that canceling the agreement would cost German taxpayers over $10 billion.

The announcement from NACP comes after the Financial Times reported on Nov. 29 on the significant role the EU plays in the transshipment of Russian LNG, citing data from the Institute for Energy Economics and Financial Analysis.

The FT said that of the 17.8 billion cubic meters of Russian LNG imported by the EU between January and September 2023, 21% was transferred to ships headed to countries like China, Japan, and Bangladesh.

While the U.K. and the Netherlands have banned contracts for reshipping Russian LNG, the gas is "routinely transferred between tankers" in EU ports such as Zeebrugge, just 12 kilometers from the Dutch border, before being exported again.

The NACP said that only 7% of Russian LNG imported by Fluxys into Zeebrugge goes to EU markets.

The EU has not imposed sanctions on Russian LNG.

Though pipeline gas imports to Europe decreased sharply in response to Russia's war, EU nations bought record amounts of Russian LNG in 2023.

Read also: FT: US seeks to foil Russia’s zeal to become major LNG exporter

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