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Japan’s Nippon Oil Corporation announced it will purchase about 700,000 barrels of oil extracted within the Sakhalin-1 oil and gas project, with the oil supplies shipment beginning this October.

The purchase will become the first batch of oil bought by Nippon Oil within the ExxonMobil-operated project, which involves the development of the Chayvo, Odoptu and Arkutun-Dagi fields off Sakhalin's northeastern coast.

The decision resulted from the company’s effort to lessen the dependence on oil supplies from the unstable Middle East market, which now accounts for 90 percent of Nippon Oil imports.

Another advantage is Japan’s territorial proximity to Russia.The oil shipment from the terminal at De Kastri in the Khabarovsky region, where it is pumped from the north of Sakhalin, to Japan will take about five days.

Producing crude oil with the Sakhalin-1 project started last October, with most of it going mostly to Russia's domestic market. Since this fall, the daily extraction volume of oil is planned to increase to 250,000 barrels, which accounts to 5 percent of Japan’s annual demand for oil.

The Sakhalin-1 fields’ reserves are around 2.3 billion barrels of oil and 485 billion cubic meters of gas. Capital expenditures on the development of all three fields are estimated at more than $12 billion.

Along with ExxonMobil, with the company’s stake of 30 percent, the Sakhalin-1 consortium also includes Japan's SODECO with a 30 percent stake, India's ONGC Videsh Ltd. with a 20 percent stake, and Russia’s Rosneft which has a 20 percent stake.


From Itar-Tass and Ria Novosti news agencies