"On the whole, we have the gas resources, and we're ready to meet the entire Japanese demand for gas," Sechin noted at a plenary discussion. He said this would require the appropriate infrastructure and gas-production investment.
The Sakhalin-1 product-sharing agreement involves three deposits (Chaivo, Odoptu and Arkutun-Dagi) on the northeastern Sakhalin shelf. Project operator Exxon Neftegas Ltd. owns a 30 percent stake in the venture, with Rosneft, Japan's Sodeco and India's Oil and Natural Gas Corporation (ONGC) owning 20, 30 and 20 percent respectively.
The three deposits contain an estimated 307 million metric tons of oil and 485 billion cubic meters of gas. Earlier, ExxonMobil insisted on exporting Sakhalin gas. But only Gazprom can export gas under Russian law.
Gazprom which has a controlling interest in the Sakhalin-2 project has repeatedly tried to reach an agreement with Exxon and Rosneft on buying Sakhalin-1 gas. This would expand the Sakhalin-2 project. But Exxon refused to sell Russian gas for domestic prices, with Gazprom refusing to pay the export prices.
Therefore all Sakhalin-1 gas is currently being pumped back into the ground. Russia's partners in the Sakhalin-1 project have repeatedly noted their intention to transport gas from northern Sakhalin to an LNG plant that was to have been built by Rosneft and ExxonMobil in southern Sakhalin.