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ExxonMobil, CNPC Negotiate on Sakhalin-1

sakhalin_01102007 Sakhalin-1 operator ExxonMobil and Chinese CNPC proceed with the talks on potential gas supplies under the project, Interfax reported with reference to Robert Olsen, who is in charge of ExxonMobil production in Europe.

The preliminary agreement on supplying gas to China was made with CNPC in 2002, the official reminded, specifying that today’s purpose is to conclude a final agreement. But there are other options, Olsen said, adding that they are also negotiating with Gazprom.

According to earlier reports, Gazprom is willing to buy the gas produced under the Sakhalin-1 project, saying it needs it to gasify the regions of Russia. The monopoly plans to ink with Exxon a binding agreement on gas sales in April, said Alexander Ananenkov, deputy chairman at Gazprom Executive Committee.

The Sakhalin-1 project is executed by Exxon Mobil subsidiary Exxon Neftegaz Ltd. (30 percent), Indian ONGC (20 percent), Rosneft (20 percent) and Japan’s Sodeco (30 percent). Potential recoverable reserves are estimated at 307 million tons of oil (2.3 billion bbn) and 485 billion cu meters of gas.

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