TotalEnergies is asking the French government and EU Commission to clarify an EU ban on Russian liquefied natural gas (LNG) imports, CEO Patrick Pouyanne said on Wednesday.
"It appears a European company cannot market Russian LNG, which we did not initially anticipate," Pouyanne told an analyst briefing, adding that if the French oil major could not market the fuel from its Yamal project in Russia, it may exit the project.
Total is one of the largest buyers of Russian LNG, offtaking some 5 million metric tons of the fuel annually for delivery to clients in Europe and Asia.
Pouyanne said last year that if the EU ban was only on importing Russian gas, he could divert cargoes to Turkey or Asia.
On a fourth-quarter earnings call with analysts on Thursday, he said that restrictions on ownership of Russian LNG projects or selling the fuel elsewhere would pose problems.
Total owns a 20% direct stake in Yamal LNG as well as a 19.4% stake in private Russian company Novatek, Yamal's parent.
"If European firms are prevented from marketing Russian LNG, the risk of force majeure and project exits rises sharply, a development that could tighten Atlantic Basin supply and push up spot LNG and European gas prices,” said Aly Blakeway, manager of Atlantic LNG at S&P Global Energy.
Total, which no longer includes its Russia holdings in its financial reports, declared force majeure on another Novatek project, Arctic LNG 2, in 2024 after the export facility was placed under U.S. sanctions.
It has been unable to repatriate dividends from its Novatek shareholding, saying in 2024 that more than $2 billion was trapped in Russia.
(Reuters - Reporting by America Hernandez in Paris and Marwa Rashad in London. Writing by Dominique Patton. Editing by Jane Merriman, Kirsten Donovan)