China is preparing a second import terminal to handle liquefied natural gas cargoes from Russia's sanctioned Arctic LNG 2 project, according to three sources with knowledge of the plans. The newly built Longkou terminal in eastern Shandong province, operated by state pipeline giant PipeChina, is being readied to receive shipments alongside the Beihai facility that has so far carried the entire flow.
The move offers a lifeline to a $21 billion project that has struggled under heavy US sanctions, and to Moscow, whose gas exports have been hit by Europe's decision to halt purchases and whose oil sector faces pressure from Ukrainian attacks. Neither PipeChina nor Novatek, Arctic LNG 2's majority owner, responded to requests for comment.
Beihai has received 41 cargoes, or 2.6 million tons, of Arctic LNG 2 product since August 2025, often routed through two floating storage units in Russia, according to ship tracking data and Kpler estimates. The plant has also taken three cargoes from Russia's sanctioned Portovaya terminal. China bought 7.57 million tons of LNG from Russia last year and remains the only known buyer of sanctioned Arctic LNG 2 volumes.
Longkou's first phase has an annual receiving capacity of 5 million tons, compared with 6 million at Beihai, and one industry executive said the plant has completed its mechanical build and should be ready before October, in time for peak winter demand. PipeChina's Dalian terminal in the northeast is also under discussion as a future receiving point, a fourth source said. Reuters previously reported that Novatek has cut cargo prices 30 to 40 percent since August 2025 to attract Chinese buyers despite the sanctions risk.
A second terminal would meaningfully expand the only working escape route for Arctic LNG 2 output, which was designed to produce 19.8 million tons a year before US designations froze most foreign buyers out. For shipowners, traders and refiners watching how far Beijing will push into sanctioned Russian energy, the Longkou plan signals that the discounted Arctic LNG 2 trade is set to scale rather than wind down.