Linde Declines as Russian Court Seizes Baltic LNG Assets

By Geoffrey Smith

Linde’s stock saw a decline of 2.6% in early trading on Tuesday following news that a regional court in Leningrad seized assets in Russia valued at over $500 million, at the request of the Russian gas monopoly, Gazprom.

Gazprom, alongside another domestic company, pursued legal action against the German-U.S. enterprise for breach of contract when Linde failed to finalize the construction of a gas processing facility at the Ust-Luga port on the Baltic Sea. This facility was intended to be part of a broader initiative that included the shipment of liquefied natural gas (LNG) to international markets, thereby enhancing Russia’s influence in the energy sector beyond its conventional European markets.

Linde halted operations not only at this facility but also at its larger Arctic LNG project near Murmansk following Russia’s invasion of Ukraine in February of the prior year. This invasion triggered sanctions aimed at Russia’s oil and gas industries. As a result, the suspension of these LNG projects has considerably delayed Russia’s aspirations in the global gas market.

Moreover, the war has significantly reduced Russia’s foothold in its traditional export markets. Gazprom reported a 45.5% decrease in its exports outside the former Soviet republics—historically its main revenue source—last year, amounting to just over 100 billion cubic meters. Exports are expected to decrease further this year as Moscow continues to withhold gas supplies from EU nations currently imposing sanctions.

The agreement between Linde and its Russian counterparts is formally subject to international arbitration in a tribunal with locations in Hong Kong and Stockholm. However, the recent court ruling severely diminishes the chances that Linde will recover any of its invested capital.