PARIS, March 3 (UPI) -- French supermajor Total said it was buying a 12 percent stake in Russian natural gas producer Novatek in a deal that includes work in Russia's arctic.
Total will take an eventual 20 percent stake in liquefied natural gas projects owned by Novatek as part of a deal worth around $4 billion.
Total through the deal becomes a partner in Novatek's arctic LNG project in the Yamal Peninsula. Novatek retains control over the project.
Total said it estimated the reserve capacity at the Yamal project was around 44 trillion cubic feet of gas. This would allow the companies to produce more than 15 million tons of LNG each year.
Christophe de Margerie, chairman and chief executive officer at Total, said in a statement the deal puts his company at the forefront of the LNG sector.
"In becoming the first international investor to participate in the development of the giant gas resources of the Yamal Peninsula, Total pursues its strategy aimed at establishing partnerships in producing countries with national players and confirms its leading position in the liquefied natural gas business," he said.
Novatek in a statement said overall investments for Yamal LNG are estimated at $20 billion.