Page 12 - GLNG Week 40 2022
P. 12
GLNG ASIA GLNG
Russia seizes Sakhalin-1
oil and gas project
POLICY RUSSIAN President Vladimir Putin on Octo- completely, making it doubtful that the US major
ber 7 ordered the seizure of the ExxonMo- will apply to retain its stake in Sakhalin-1. Japa-
bil-led Sakhalin-1 oil project, signing a decree nese investors have been more reluctant to give
that establishes a new operator to manage the up their energy assets in Russia. At Sakhalin-2,
development. Japan’s Mitsui and Mitsubishi opted to retain
It follows a similar presidential decree intro- their shares in the Gazprom-led project, citing
duced at the end of June, under which Russia concerns about the impact their exit would have
transferred all rights and obligations of the con- on Japanese energy security. Japan is the big-
sortium managing the Sakhalin-2 project to a gest buyer of LNG from the terminal. Russia’s
Russian entity. Both decrees give the Russian Novatek is reportedly interested in buying the
government authority to decide whether for- share of the other partner at Sakhalin-1, Shell.
eign shareholders can retain their interests in This said, Japan had already stopped buying
the projects. crude from Russia in June, and so they may be
ExxonMobil operates Sakhalin-1 with a 30% more willing to withdraw from Sakhalin-1.
interest, while Russia’s Rosneft, India’s ONGC As for India’s OVL, it has expressed no desire
Videsh Ltd (OVL) and Japan’s SODECO serve to leave Russia in the wake of Moscow’s inva-
as partners. Prior to Russia’s invasion of Ukraine, sion of Ukraine. In fact, the company and other
the project, consisting of three offshore fields, Indian oil refiners have been ramping up Rus-
was producing around 220,000 barrels per day sian oil purchases, taking advantage of the steep
of oil. But it has since fallen to only 10,000 bpd. discount that the supplies currently trade at as a
ExxonMobil announced its intention in result of sanctions and their rejection by Western
March to withdraw from the Russian oil industry buyers.
P12 www. NEWSBASE .com Week 41 14•October•2022
