Electric increases purchase of LNG from Sakhalin Energy
Posted: 23 April 2004
The Sakhalin II Project achieved another major marketing success
today, when The Tokyo Electric Power Company, Incorporated (Tokyo
Electric) of Japan increased the volume of liquefied natural gas
(LNG) that it will purchase from Sakhalin Energy.
In accordance with the procedure contained in the original Heads
of Agreement signed in May 2003, Tokyo Electric has increased the
long-term purchase of LNG to 1.5 million tonnes per annum
(mtpa) up from the original volume of 1.2 mtpa. In addition, Tokyo
Electric has decided to declare up to 0.7 million tonnes of additional
early volumes in 2007 and 2008.
This transaction reinforces Sakhalin Island as the new strategic
source of natural gas for Japan. It also represents the beginning
of Russia and Sakhalin as major new players in the worldwide LNG
The agreement with Tokyo Electric reinforces the positive investment
decision in May of last year to proceed with the development of
the Sakhalin II Phase 2 integrated oil and gas project. The Tokyo
Electric agreement represents another major success for Russia and
Sakhalin Energy in the competitive global
"We are extremely pleased that Tokyo Electric, our largest
LNG customer, has strengthened its position with the project. Tokyo
Electric is playing a key role as one of the leaders and our partners
in opening the closest new source of LNG supply to Japan,"
said Steve McVeigh, Chief Executive Officer of Sakhalin Energy.
The Sakhalin Oblast Governor Ivan Malakhov commented: "We
are pleased that a major Japanese utility company such as Tokyo
Electric has increased its confidence in energy supplies from Sakhalin,
and is helping to establish the Russian Far East as the new strategic
supplier of natural gas to Japan and rest of the Asia Pacific Region.
The success of the Sakhalin II Project is bringing tangible benefits
to the economy of Russia and in particular the economy of Sakhalin
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Posted by Richard Price,
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