NEWS
ExxonMobil Sakhalin-1 extraction set to start
Moscow, Aug 19 (LNG journal)
- The Sakhalin-1 project led by ExxonMobil in Russia's Far East will begin oil and gas extraction next month, officials revealed Friday. The project's sister venture Sakhalin-2 , with shareholders such as Royal Dutch Shell, will begin producing in 2008 and includes one of the world's largest liquefied natural gas projects.
However, Sakhalin-1's huge gas deposits will only be exported in the long term, mostly to northeast Asia , and by gas pipeline rather than LNG carrier.
The Russian state oil company Rosneft, one of Exxon-Mobil's partners, expects the $12-billion Sakhalin-1 project to produce 90,000 tonnes (660,000/bbl) by the end of 2005 and to begin large-scale crude oil exports to world markets in early 2006.
The announcement about the Sakhalin-1 extraction date came from the Governor of Sakhalin, Ivan Malakov, after a meeting on the island with Masataka Hayama, the president of Japan 's Sodeco Petroleum Corp. and reported by official news wire Itar-Tass.
"This will be a festive occasion for all the companies participating in the project," Malakov was cited as saying. "We are going to turn Sakhalin Island into the centre of research and production to develop the Far Eastern continental shelf and to assist oil and gas extraction projects."
Exxon Neftegas Ltd., a unit of ExxonMobil, is a 30 percent shareholder, along with Sodeco, a Japanese consortium. Affiliates of Rosneft hold 8.5 percent, Russian company Sakhalinmorneftegas-Shelf has 11 percent, and India 's state-owned oil company ONGC Videsh Ltd. has a 20 percent stake.
