A TENDER WILL DETERMINE SAKHALIN-3 FATE

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MOSCOW, April 23 (RIA Novosti) - The international consortium Sakhalin-1 will begin to deliver liquefied gas to the Khabarovsk territory on the continental side of the Tatar Strait from 2005. An agreement to the effect has been signed by the consortium participants and the Khabarovsk territory government, Governor of the Sakhalin region Ivan Malakhov said at a RIA Novosti press conference on Friday.

"We see the agreement between Sakhalin-1 and the Khabarovsk territory government on gas supplies as a breakthrough," stressed Mr. Malakhov.

In his words, gas supplies to the Khabarovsk territory will make about 2-3 billion cubic metres a year.

The governor also said that the consortium intended to supply oil to the Khabarovsk territory. At present, the opportunity of using the Sakhalinmorneftegaz infrastructure for the purpose is under consideration.

As for the Sakhalin-3 project, Ivan Malakhov said that a tender was likely to be held on it.

Mr. Malakhov said that the negotiation process between the Russian Government and the US Energy Department was stalled for a while for technical reasons" in view of the administrative reform in Russia. "But this problem undoubtedly exists," said the governor.

He did not specify the date of the tender for the right to develop Sakhalin-3 deposits.

This is a shelf project, and the shelf is the state property. Only the Russian Government can decide such issues, Mr. Malakhov said.

The Sakhalin-3 project includes three promising blocks of deposits - Vostochno-Odoptinsky, Ayashsky and Kirinsky.

Early this year, the government commission for product sharing agreements annulled the results of the tender for the development of Sakhalin-3 deposits. This competition held in 1993 was won by Exxon-Mobil and Texaco.

The commission acknowledged that there was no ground to issue licences on this block either on the basis of product sharing agreements or the ordinary tax regime.

In early April, Russian Nature Minister Yuri Trutnev told RIA Novosti that the ministry would determine the fate of the Sakhalin-3 project within a month.

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