Italian export credit agency (ECA) Sace and Intesa Sanpaolo have paired up to offer a €400mn credit line to finance Italian companies working on the Russian Yamal liquefied natural gas (LNG) project, despite continued US and European sanctions against Russia.

Intesa will issue the money, as part of two credit lines for the project, while Sace will guarantee the finance, which has been earmarked for Italian subcontractors. The second Intesa credit line is for €350mn and is backed by French ECA, Coface.

“The credit line guaranteed by Sace has been fully used up,” a spokesperson for Sace tells GTR.

“Due to confidentiality clauses, we can only confirm that 20 Italian companies specialised in oil and gas technologies, mostly SMEs, are involved. They are headed by Nuovo Pignone, an Italian GE Oil & Gas subsidiary.”

Commenting on Russian sanctions, the ECA tells GTR that it is continuing to operate in Russia, in full compliance with international regulatory requirements, and currently has a portfolio of insured transactions and guaranteed investments exceeding €3.9bn.

The Yamal LNG project has a total capital expenditure of around US$27bn, and will consist of a wide integrated liquefaction plant for natural gas coming from the South Tambey field, in the Siberian region of Yamal in Russia.

The project, which was initially envisioned to be financed by US and European investments, struggled to access capital from these markets after sanctions against Russia were imposed. Together with plunging oil and gas prices, its future had looked bleak.

The project is now being developed and managed by the vehicle company Yamal LNG, owned by Russia’s Novatek, China’s CNODC group, France’s Total and the Silk Road Fund.

Other global LNG projects, notably the proposed US$30bn Browse floating LNG project off Australia, have been shelved due to oversupply and market conditions.

Yamal LNG foresees the construction of three liquefaction trains each, the first of which is due to launch commercial operations this year. Gas from the plant is intended for European and Asian markets.