Page 10 - FSUOGM Week 50 2022

FSUOGM PERFORMANCE FSUOGM

Sakhalin oil output set to

dip 44% this year

RUSSIA OIL production at Sakhalin Island in the Russian SODECO. It is currently uncertain whether
Far East is expected to slump by 44% this year they will be permitted to keep their stakes in the
Output plunged at the to only 9mn tonnes (180,000 bpd), the Interfax venture.
formerly ExxonMobil-led news agency reported on December 12. Sakhalin-1 is the biggest oil project on Sakha-
Sakhalin-1 oil project The collapse in output comes after US oil lin Island and produces Sokol grade for exports
this year. major ExxonMobil left Russia in October, claim- to Asia. The island’s other main upstream devel-
ing its 30% stake in the Sakhalin-1 oil project opment is Sakhalin-1, which primarily produces
had been expropriated. Rosneft, another part- LNG, where Shell looks set to be forced out as
ner at Sakhalin-1, accused the US major in May an operator. Both ExxonMobil and Shell had
of causing a steep drop in the project's output. announced their intention to leave Russia after
According to Russian media reports, it fell from a Moscow launched its invasion of Ukraine. But
pre-war level of 220,000 barrels per day to a mere initially they had hoped to divest their stakes,
10,000 bpd. Reuters in October attributed the but Russia’s government later restricted foreign
drastic cut in oil exports to ExxonMobil’s refusal companies from selling strategic assets.
to accept local insurance for tankers. Western Sakhalin’s Minister for Economic Develop-
insurers stopped covering tankers operated by ment, Alexei Uspensky, said oil output in the
Russian state shipping firm Sovcomflot, after it region reached 16mn tonnes (320,000 bpd) in
was blacklisted under Western sanctions. 2021, according to Interfax. In 2023-2025, pro-
Russia’s government ordered the transfer of duction is set to be restored to 14mn tpy, which
operatorship of Sakhalin-1 earlier this month to is 52% more than in 2022, according to the
a new operator also known as Sakhalin-1. Pre- minister.
viously, besides ExxonMobil and Rosneft, other Overall Russian oil and gas condensate out-
partners at Sakhalin-1 include India’s ONGC put rose 2.2% in the first 11 months of this year
Videsh Ltd (OVL) and Japanese consortium to 488mn tonnes. ™

P10 www. NEWSBASE .com Week 50 15•December•2022