09 June 2004 09:31
Sakhalin Energy signs LNG contract with Japan
YUZHNO-SAKHALINSK. June 9 (Interfax) - Sakhalin Energy, the operator of the Sakhalin-2 project, has signed a contract
on liquefied- natural gas (LNG) deliveries with Japan's Kyushu Electric Power Company, Inc.
This is the first such contract signed with one of Japan's largest power companies, a Sakhalin Energy press
release states.
Kyushu Electric decided to change the start date for long-term deliveries of Sakhalin LNG to 2009 from 2010. The
changes have been put into the contract, the release says.
The contract was signed in July 2003 and stipulates that 0.5 million tonnes of LNG will be delivered annually for
more than twenty years. The signing of the contract was the final stage in setting up conditions for the sale of
LNG.
Sakhalin Energy considers that the final contract "confirms the company made the right choice in LNG as the most
effective way to create a new, dynamically developing market for gas from Russia's Far East to Japan and other
countries in the Asian-Pacific region," the company said.
Sakhalin Energy Executive Director Steve McVeigh and Kyushu Electric President Shingo Matsuo signed the contract.
The closeness of Sakhalin to Japan and large hydrocarbon deposits create a solid base for the development of
long-term cooperation with Kyushu Electric and gives Sakhalin Energy the possibility to become key, long-term suppliers
for this large Japanese power company, McVeigh said.
LNG will be delivered from a large plant that is being built near the town of Prigorodnoye in southern Sakhalin. The
construction site is almost finished and work has begun on building LNG capacity.
Sakhalin Region Governor Ivan Malakhov said "we are pleased that the purchase contract with Kyushu Electric
stipulates the increase of LNG deliveries."
Matsuo said Kyushu Electric considers the Sakhalin-2 project as a new, stable source for deliveries of energy
resources because it has large deposits and is close to Japan.
Sakhalin Energy is owned by Royal Dutch/Shell (55%), Japan's Mitsui (25%) and Mitsubishi (20%).
The Sakhalin-2 project is being carried out under a production sharing agreement. The project involves the
development of the Piltun-Astokhskoye and Lunskoye fields off the Sakhalin coast. Total reserves of oil and gas at these
deposits amount to 185 million tonnes and 800 billion cubic meters respectively. [RU ASIA EUROPE EEU EMRG TRD ENR NGS JP
CORA WEU] rm me RTS$#&:
[Interfax] |
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