Wednesday, June 17, 2009

Bad News for Wally Hickel's Boys

Gazprom sees Sakhalin LNG exports at 5 mln T

MOSCOW, June 17 (Reuters) - Russia's Gazprom (GAZP.MM) expects liquefied natural gas (LNG) exports from its Sakhalin-2 project to exceed five million tonnes this year, up from the initial plan of three million, an executive said on Wednesday.

Gazprom's export chief Alexander Medvedev told a news conference Sakhalin-2, which also involves Royal Dutch Shell (RDSa.L) and Japan's Mitsui (8031.T) and Mitsubishi (8058.T), would reach target capacity of 9.6 million tonnes next year.

The amount of Alaska LNG needed to make the Valdez terminal viable will never compete with Russia's ability to produce gas from Sakhalin and sell it to the Asian markets. Period.

The relative proximity of the Sakhalin export facilities to key Asian gas importers, such as Japan and South Korea, would push down transit costs for Asian consumers, giving Russia a competitive edge, analysts said.

Meanwhile in news a few days ago...

Gazprom, Total and StatoilHydro already firming up Arctic Ocean development plans

ABS, ConocoPhillips, Sovcomflot and Samsung Heavy Industries are together making a study of the effect of ice loading on Arctic class shuttle tankers. The third Arctic class tanker of 70,000 dwt was scheduled for delivery in February. These tankers will be equipped with fiber-optic sensors to measure and record ice pressures. This activity in a high-operating cost theater reveals the concern that companies have that time is quickly running out on existing oil and gas supplies.

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