5 Sep 2022 16:25

Several candidates to join Sakhalin 2 project appear - Putin

PETROPAVLOVSK-KAMCHATSKY. Sept 5 (Interfax) - Several candidates to join the Sakhalin 2 project have appeared, Russian President Vladimir Putin said during a meeting on the social and economic development of the Kamchatka Territory.

Putin signed a decree in June on "special economic measures in the fuel and energy sector in connection with the unfriendly actions of certain foreign nations and international organizations." Under the decree, the operator of Sakhalin-2, Bermuda-based Sakhalin Energy Investment Company Ltd was replaced by a Russian company. The new operator was registered and began operating in August.

The decrees states that on establishment, Gazprom Group's Gazprom Sakhalin Holding LLC should receive a participatory share of 50.00000001378317%. The remaining share of 49.99999998621683% should remain on the balance sheet of Sakhalin Energy LLC itself. The current foreign shareholders in Sakhalin Energy, which are Shell (SPB: RDS.A), Mitsui, and Mitsubish, must agree within a month to receive a stake in the new Russian LLC.

The government issued an instruction last week on Mitsui & Co., Ltd receiving 12.5% and Mitsubishi Corporation 10% stakes, the same as they held in the old operator. Shell has informed the Russian government that it will not join in Sakhalin Energy. If a stake is not claimed by a foreign partner, it is subject to evaluation and sale by the government to a Russian legal entity.

Putin said at the meeting on Monday that there are a "sufficient number of candidates" for participation in Sakhalin 2. "As concerns Sakhalin 2, we have enough who are willing to join this project. Both foreigners and Russian legal entities," he said.

Sakhalin-2 is developing the Piltun-Astokhskoye and Lunskoye fields on the Sakhalin shelf.

The Sakhalin-2 LNG plant in Prigorodnoye, southern Sakhalin, was put into operation in February 2009 and reached its full capacity of 9.6 million tonnes of LNG in 2010. A later optimization program allowed for increasing its capacity by 20% up to 11.5 million tonnes of LNG per year.