Cyprus Mail

Argentina turns away Gunvor-chartered LNG tanker, citing sanctions

peronist presidential pre candidates attend an event at general confederation of labor headquarters in buenos aires
FILE PHOTO: Argentina's Economy Minister Sergio Massa

A tanker containing liquefied natural gas (LNG) that originated from a Russia supplier and was loaded onto a Gunvor Group-chartered <GGL.UL> vessel off the coast of France was turned away this week by Argentine energy firm Enarsa, according to officials.

The tanker Flex Artemis was in the South Atlantic and heading northeast on Thursday, according to Refinitiv vessel tracking. It had carried LNG from Yamal in Russia, according to a trader familiar with the matter, and had arrived in Argentine waters about July 14.

The rejection is one more sign of the energy market upheavals since Russia’s invasion of Ukraine last year and of a growing wariness of buyers involving even authorized deals with Russia-originated fuels. It also reflects this year’s surplus of LNG on global markets.

“Enarsa blocked that delivery because it violates the contract, because it is a company with sanctions,” Argentina’s Economy Minister Sergio Massa said this week.

An LNG trader familiar with Enarsa’s business said an international bank involved in the transaction had blocked payment to avoid running afoul of secondary sanctions involving financial transactions.

A spokesperson for Geneva-based Gunvor denied the LNG was turned away over Russia sanctions and said the deal counterparty was aware of the cargo’s origin.

“An alleged decision by a European bank to self-sanction, i.e., act beyond the laws in place, has no bearing on the legality of the transaction or the legal policy of Argentina toward Russia,” the person said.

LNG prices have tumbled this year, trading in Europe at under $10 per million British thermal units (mmBtus) this month after soaring to more than $70/mmBtu last August as Russia’s gas flows to Europe were cut.

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