Exxon Chooses Russian Shipyard For Upgrade Of Rig For $15 Billion Venture

An ExxonMobil led group has chosen a Russian shipyard to upgrade an oil rig for use in tapping fields off the nation's Pacific coast in a fifteen billion dollar venture to supply oil to the US and Asia and gas to Japan.

The world's largest publicly traded oil company will pay $140 million to Amur Shipyard, a Far Eastern shipbuilder that made submarines for Russia's Pacific Fleet, to convert the platform so it can withstand heavy ice near Sakhalin Island. Exxon owns thirty percent of Sakhalin 1, which has estimated reserves equal to the annual output of Russia, the world's second largest oil exporter.

International oil companies are boosting investment in Russia, drawn by President Vladimir Putin's success in creating a more political stable environment, as Middle Eastern energy projects are delayed by hesitance about outside investment. TotalFinaElf moved ahead with a two and a half billion dollar Russian oil project yesterday. President George W. Bush arrives in Moscow today to meet with Putin.

“We are pleased this contract has been awarded to a Russian company that is well qualified for this type of work,” Exxon Neftegaz President Neil Duffin said in a statement.

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