BBC Monitoring Service: Japanese energy mission visits oil and gas facilities in Russia's Far East: “The British and Dutch company Royal Dutch Shell and Japan's Mitsiu and Mitsubishi trading and investment corporations are participants in the Sakhalin-2 project.” (ShellNews.net)

Sep 28, 2004

Yuzhno-Sakhalinsk, 28 September: A delegation of Japan's largest power companies led by the president of Japan's Michinoku bank, Kazuo Harada, today arrived in the town of Okha in northern Sakhalin to familiarize itself with the Sakhalin-1 project. Under this project, oil extracted from Chayvo, Odoptu and Arkutun-Dagi shelf oilfields will be transported through a 220-km pipeline to the port of De-Kastri in Khabarovsk Territory and from here to Asian Pacific Region countries.

Prospected reserves in three oilfields stand at 307m t of oil and 485bn cu.m. of gas. The American Exxon Neftegaz Ltd, the Japanese Sodeko consortium, the Indian Oil and Natural Gas Corporation and Rosneft subsidiary companies are involved in the Sakhalin-1 project.

The Yastreb drilling rig is now making 10 wells in the direction of the Chayvo oilfield. The head of the Exxon representative office on Sakhalin, Michael Allen, said that two 11-km and 9-km long wells had already reached the oil bed. The Exxon company, which is the Sakhalin-1 project operator plans to yield first oil at the end of 2005.

The Japanese delegation is also expected to visit today the plant to liquefy natural oil and gas which is being built in the village of Prigorodnoye in southern Sakhalin. It is being built under the Sakhalin-2 project. The enterprise will receive oil and gas from Piltun-Astokhskoye and Lunskoye shelf fields. Their oil reserves stand at 140m tonnes and gas reserves at 408bn cu.m. Hydrocarbon fuel will go to the plant through a 800-km oil and gas pipeline. By now over 100 km of the oil pipeline has been already laid.

The plant is expected to start supplying liquefied gas to the international market on 2007. The capacity of the enterprise is 9.6m t of gas annually. The first agreement on Sakhalin gas supply to Japan was signed on 9 June 2004. Starting from 2009, Japan's largest company Kyushu Electric Power will be receiving gas for 20 years. The amount of supplies is 0.5m t of gas annually. Another three Japanese power companies signed agreements on the purchase of gas from Sakhalin. The British and Dutch company Royal Dutch Shell and Japan's Mitsiu and Mitsubishi trading and investment corporations are participants in the Sakhalin-2 project.

Source: ITAR-TASS news agency, Moscow, in Russian 0112 gmt 28 Sep 04