Two Japanese Companies to Invest About 10 Billion Dollars into Russian Oil-And-Gas Project

Japan's Mitsui and Mitsubishi companies together with the Dutch group Royal Dutch Shell agreed to invest about 10 billion dollars into a Russian oil-and-gas project. Such investment, due to be received over a five-year period, will make it possible to implement the Sakhalin-2 project on a grand scale, Nihon Keizai Shimbun reported here today.

Shell will contribute the lion's share of all investment, i.e. 55 percent; meanwhile Mitsui and Mitsubishi will account for 25 percent and 20 percent, respectively.

According to Nihon Keizai Shimbun, the Sakhalin Energy joint-stock company, established in 1992, will start producing liquefied natural gas starting with 2007 on shelf deposits east of Sakhalin island. Experts say that local gas deposits will meet an estimated 10 percent of all East Asian gas demand.

Oil-and-gas deposits being developed in line with the Sakhalin-2 project, contain some 1.1 billion barrels of oil and 360 million tons of liquefied gas.

Two big-league Japanese companies, namely, Tokyo Electric Power and Tokyo Gas, will be annually buying more than one million tons of Russian gas each, Kyodo Tsushin reports. Another three Japanese companies are interested in this project, as well. Quite possibly, Sakhalin Energy will also be selling gas to South Korea and Taiwan.

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