Gazprom, Shell progress on Sakhalin

Russia-based Gazprom and Shell signed an agreement for the preparation of FEED documents for the production of LNG within the Sakhakin II project off Sakhalin Island, Russia.

“We welcome the sequential approach of our partner Gazprom to expanding the LNG plant in the Prigorodnoye settlement,” Shell CEO, Ben van Beurden (pictured, left) said. “The third train will help confirm the status of the Sakhalin II project as a reliable energy supplier to the Asia-Pacific region."

Gazprom owns the only functioning LNG operation in Russia, located off Sakhalin Island. As part of the project, Russia's first LNG plant was commissioned in early 2009 and consumers abroad started receiving LNG from Russia. In 2010, the plant reached its full capacity of 9.6 million tons per annum.

A total of 10.8 million tons of LNG and 5.4 million tons of oil were produced within the Sakhalin II project in 2013.

“The global LNG market is booming—primarily in Asian countries. Novel LNG production capacities are the key to achieving a strong position in this market,” Gazprom chairman, Alexey Miller (pictured, right) said.

Sakhalin Energy is the Sakhalin II project operator. The company is owned by Gazprom (50% plus one share), Shell (27.5% minus one share), Mitsui & Co. (12.5%) and Mitsubishi Corp. (10%).

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