MOSCOW, June 26 (RIA Novosti) - Gazprom's [RTS: GAZP] deputy CEO said Tuesday the company expected total earnings from exports in 2007 to exceed $38 billion.
"Revenue in 2007 will beat previous records. Projected revenue is $38.1 billion," said Alexander Medvedev, who heads the Russian energy giant's export arm Gazpromexport, adding that export earnings in 2006 totaled $37.2 billion.
Medvedev also said Gazprom would invest $1.6 billion in the Sakhalin-II oil and gas project off Russia's Pacific Coast in 2007.
The Sakhalin-II project, in which Gazprom bought a controlling stake from oil major Shell last year, comprises two deposits with estimated reserves of 150 million metric tons (1.1 billion barrels) of oil and 500 billion cubic meters of natural gas.
"The project's budget for 2007 is $3.3 billion, of which $1.6 billion will be invested by Gazprom," Medvedev said.
The Gazprom executive said these funds would be used for environmental conservation activities at the construction stage and for the entire term of the project's duration.
Gazprom plans to build a new gas pipeline from Sakhalin Island to Komsomolsk-on-Amur, Khabarovsk and Vladivostok in the Far East with annual capacity of 4.5 billion cubic meters, Medvedev said.
"The scheme of gasification of the Far East provides a possibility of extending the Sakhalin-Khabarovsk pipeline to Vladivostok," Medvedev said.
The Sakhalin-I project, operated under a production-sharing agreement (PSA) by Exxon Neftegas Limited, a subsidiary of U.S. oil major Exxon, will be the resource base for gas deliveries via a new pipeline. Gazprom is currently in talks with ExxonMobil on the issue, Medvedev said.
The Sakhalin-I project is expected to bring in around $52.2 billion to the Russian budget by 2054, when it is scheduled to end. Potential recoverable reserves at Sakhalin-I, which includes three large gas fields off northeast Sakhalin, amount to 485 billion cubic meters of gas.