Source: the Sakhalin 2 plant
Sakhalin 2 makes LNG debut
Russia will supply about 50 cargoes of liquefied natural gas this year from its new plant on the Pacific island of Sakhalin, most of which will go to Japan, the plant's operator said.
Sakhalin Energy, controlled by Russian gas export monopoly Gazprom, launched the Sakhalin 2 project today, which will ultimately produce 9.6 million tonnes of super-cooled gas per year.
"This year, the project will ship around 50 145,000-cubic-metre tankers of LNG and about 50 cargoes of oil, each 700,000 barrels," Sakhalin Energy chief executive Ian Craig told a new briefing ahead of the launch.
The $22 billion project, in which Anglo-Dutch supermajor Shell also has a stake, is Russia's first LNG plant and opens up a new frontier for the world's largest gas producer as a supplier to Asian markets and the US West coast.
A Sakhalin Energy spokesman said the total LNG volumes were equivalent to 3.2 million tonnes for this year, about half the earlier government estimates of 6 million tonnes.
But the amount is expected to rise to about 160 cargoes as the facility reaches full capacity next year, he said.
About 65% of the plant's output will be shipped to eight companies in Japan, the world's top consumer of LNG, with the rest sold to South Korea and the LNG-hungry North American market via a Mexican terminal, then on to the US West Coast.
The first cargo is expected to load at the end of March, said Hisanori Yoshimura, a member of the board of directors of Mitsubishi, which also holds a stake in the project. Mitsui is the other Japanese shareholder.
The first tanker, the 145,000-cubic-metre Grand Aniva, was built by Mitsubishi in Japan and is owned by Nippon Yusen, Japan's biggest ocean shipping company, and Russian shipping group Sovcomflot.
Tokyo Gas Company and Tokyo Electric Power Company are likely to split the first cargo, company officials told Reuters at the ceremony to launch the plant.
South Korea, second only to Japan as an LNG buyer, has secured about 1.5 million tonnes of LNG for the next 20 years, its energy ministry said. Shipments from Sakhalin to South Korea will take three days, compared with 15 from the Middle East.
Sakhalin 2, on the southern tip of the island of the same name and a short boat ride from Japan, is the world's most modern LNG facility.
The project, launched after several delays, became a landmark case in the Kremlin's re-establishment of control over Russia's strategic natural resources.
Gazprom bought control of the project after a prolonged crisis that forced Shell, the project's former leader, and its partners to reduce their holdings. Analysts had expected the battle would lead to delays.