Mitsui and Mitsubishi will stick with Sakhalin 2 to keep China away from the gas project
Japanese trading houses, Mitsui and Mitsubishi, are reportedly not considering quitting Russia’s Sakhalin-2 project, that is focused on producing and shipping liquified natural gas (LNG), 60% of which is destined for the Japanese market.
The Japanese trading giants, which hold a total stake of 22,5% in Sakhalin-2, will remain partners to the project, as “prompt exit is risky” and “will be in favor of China,” Nikkei newspaper reports, citing documents submitted by the companies to the Ministry of Economy, Trade and Industry of Japan earlier this month.
The project has been one of the main sources of natural gas supply to Japan with nearly 100% of Japanese LNG imports coming from Sakhalin-2, according to media reports. Located on the Russian island of Sakhalin in the Pacific Ocean, north of Japan, the project reportedly produces nearly 11.5 million tons of LNG annually which is mainly exported to major markets in Asia.
The project, launched in 2009, includes the offshore Piltun-Astokhskoye oil field and Lunskoye natural gas field in the Okhotsk Sea, and associated infrastructure on Sakhalin Island itself.
Sakhalin-2 is managed and operated by the Sakhalin Energy Investment Company. The majority stake in the enterprise belongs to Russia’s energy giant Gazprom. Shell, the world’s largest LNG trader, holds 27,5% minus one share, Mitsui’s share totals 12,5%, while Mitsubishi Corporation owns 10%.
On February 28, UK-based Shell announced plans to pull out its stake in the Sakhalin-2 liquefied natural gas facility, its 50% stake in the Salym Petroleum Development and the Gydan energy venture following sanctions placed on Moscow over the ongoing military operation in Ukraine.
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