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ExxonMobil's Sakhalin-1 ready to ship oil to Asia
AFP
VLADIVOSTOK, Russia
Petroleumworld.com 09 12 06
ExxonMobil-led Sakhalin-1, a vast oil and gas project in Russia's far east, will begin shipping oil to energy-hungry Asian markets later this month, ExxonMobil's Russian subsidiary said in a statement Monday.
"Construction has been completed on a 24-inch-wide (61-cm-wide) pipeline that runs 225 km (140 miles) and will carry oil from a well in Sea of Okhotsk though the Chayvo offshore processing complex and to the west across Sakhalin Island," Exxon Neftegaz said in a statement.
Oil production is expected to reach 30,000 tons (250,000 barrels) per day by the end of 2006, the company said.
The Sakhalin-1 consortium began extracting oil in October 2005, producing 6,300 metric tons (50,000 barrels) per day, which was sold to consumers in Russia's far east.
Shipments will now focus on neighboring markets in Asia, the company said.
Exxon owns a 30-percent stake in the consortium, which it shares with Russian state oil major Rosneft (20 percent), India's ONGC (20 percent), and an investment group of four Japanese companies (30 percent).
The announcement came as Russia's increasing state control over the energy sector is squeezing both Exxon and Shell, which heads the 20-billion-dollar (16-billion-euro) Sakhalin-2 oil and gas project.
Exxon is in talks with the Russian government over whether its license for Sakhalin-1 extends to newly discovered oil deposits in the region, which Russia wants to auction off independently.
Shell is facing a lawsuit from the Russia state service for natural resources use to halt work on Sakhalin-2 over alleged environmental violations.
A report by the ministry of natural resources in May attacked both Shell and ExxonMobil for cost overruns at the Sakhalin sites and said Russian companies should be given majority control of both projects.
AFP 11 1130 GMT 09 06
Copyright ©2006 AFP. All Rights Reserved.
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