Russia to install new operator for Sakhalin 2 energy project
KYODO NEWS
Russian President Vladimir Putin has signed a decree to set up a new operating company for the Sakhalin 2 oil and liquefied natural gas project, Russian media reported, casting the investments of two Japanese firms into doubt.
The two major Japanese trading houses Mitsui & Co. and Mitsubishi Corp. could be forced to withdraw from the project in the Russian Far East, as foreign investors must apply within a month to retain their existing shares in the new entity, according to the decree.
File photo shows a liquefied natural gas tanker that traveled from Sakhalin 2 arriving off Sodegaura, Chiba Prefecture in eastern Japan, in April 2009. (Kyodo)
The decree signed Thursday comes after British oil giant Shell PLC, which has an approximately 27.5 percent stake in the project, said on Feb. 28 that it would exit Sakhalin 2, a joint venture with Russian energy company Gazprom, following Russia's invasion of Ukraine. Gazprom holds around a 50 percent stake in the project.
Japanese trading houses Mitsui and Mitsubishi, which hold 12.5 percent and 10 percent stakes, respectively, said they are confirming the facts in response to the news.
Japan's Deputy Chief Cabinet Secretary Seiji Kihara told reporters Friday, "Our interests in our country's resources must not be undermined," adding that the government is examining the impact of the latest development.
The decree said the removal of the operating firm is aimed at protecting Russia's national interests from "unfriendly" acts by the United States and other countries which have imposed sanctions on Moscow.
Tokyo has coordinated with the United States and European countries to impose sanctions on Russia.
But the Japanese government has stressed the need to retain interests in oil and gas projects on the Russian Far East island of Sakhalin as they are vital to securing stable energy supplies.
KYODO NEWS
Russian President Vladimir Putin has signed a decree to set up a new operating company for the Sakhalin 2 oil and liquefied natural gas project, Russian media reported, casting the investments of two Japanese firms into doubt.
The two major Japanese trading houses Mitsui & Co. and Mitsubishi Corp. could be forced to withdraw from the project in the Russian Far East, as foreign investors must apply within a month to retain their existing shares in the new entity, according to the decree.
File photo shows a liquefied natural gas tanker that traveled from Sakhalin 2 arriving off Sodegaura, Chiba Prefecture in eastern Japan, in April 2009. (Kyodo)
The decree signed Thursday comes after British oil giant Shell PLC, which has an approximately 27.5 percent stake in the project, said on Feb. 28 that it would exit Sakhalin 2, a joint venture with Russian energy company Gazprom, following Russia's invasion of Ukraine. Gazprom holds around a 50 percent stake in the project.
Japanese trading houses Mitsui and Mitsubishi, which hold 12.5 percent and 10 percent stakes, respectively, said they are confirming the facts in response to the news.
Japan's Deputy Chief Cabinet Secretary Seiji Kihara told reporters Friday, "Our interests in our country's resources must not be undermined," adding that the government is examining the impact of the latest development.
The decree said the removal of the operating firm is aimed at protecting Russia's national interests from "unfriendly" acts by the United States and other countries which have imposed sanctions on Moscow.
Tokyo has coordinated with the United States and European countries to impose sanctions on Russia.
But the Japanese government has stressed the need to retain interests in oil and gas projects on the Russian Far East island of Sakhalin as they are vital to securing stable energy supplies.
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Summary
Russia establishes a new operator for the Sakhalin 2 energy project, putting Japanese firms Mitsui & Co. and Mitsubishi Corp.'s investments at risk due to a one-month application deadline for foreign investors to retain their shares in the new entity. The move follows Shell PLC's exit from the