Exxon expects to invest $5 bn over five years to stabilize and increase oil production in Sakhalin, Sakhalin Governor Valery Limarenko said on Tuesday at the Sakhalin Oil and Gas Far East Energy Forum.
The American supermajor ExxonMobil is determined to continue investing in successful business in Russia, as reported by Darren Woods, Chairman of the Board of Directors and the new President of the company, who replaced Rex Tillerson, the new US Secretary of State, in January.
“As for Russia, we will stay there for a long time. We have a successful business there, and we will continue to invest in this business,” said Mr. Woods during the interview with Forbes Magazine.
Exxon Mobil Corporation (NYSE:XOM) announced today that production has begun at the Sakhalin-1 project’s Arkutun-Dagi field – the last of the three fields to be developed. Peak daily production from the field is expected to reach 90,000 barrels.
The field, located off the northeast coast of Sakhalin Island in the Russian Far East, will bring total daily production at Sakhalin-1 to more than 200,000 barrels. The other two fields – Chayvo and Odoptu – began production in 2005 and 2010, respectively.
Production from Sakhalin-1’s Arkutun-Dagi field will be routed through the existing Chayvo onshore processing facility on Sakhalin Island and delivered through pipelines to the De-Kastri oil export terminal located in Khabarovsk Krai, Russia.
Exxon Neftegas Ltd. is the Sakhalin-1 Consortium operator with 30 percent interest. Coventurers include Sakhalin Oil and Gas Development Co. Ltd., with 30 percent interest, and affiliates of Rosneft, the Russian state-owned oil company, RN-Astra with 8.5 percent, Sakhalinmorneftegas-Shelf, with 11.5 percent, and ONGC Videsh Ltd. with 20 percent.
Russian President Vladimir Putin gave the start signal through a teleconference for the drilling of the 700-million-dollar oil well in the East Prinovozemelsky field in the Kara Sea.
The drilling is one of the joint development projects of four sea shelf deposits off Siberian northern shores between Russian state oil company Rosneft and U.S. oil and gas giant ExxonMobil.
Putin said this is another important step in the development of the Arctic’s promising deposits, calling Exxon Russia’s long- standing and reliable partner.
“We value our relations. I am convinced that Rosneft’s joint projects with Exxon and other companies would benefit our national economies and help strengthen a global energy situation, develop breakthrough technologies, and create new jobs,” he said.
The drilling will continue until the end of October before the ice period starts, according to the Interfax news agency. The West Alpha rig has been especially equipped with an innovative ice control and ice defense system for drilling in harsh climate conditions.
Putin said that businessmen should be guided by pragmatism and common sense, “despite difficulties in current political trends.” He praised Exxon’s move as “truly responsible and businesslike,” and stressed that Russia is open to cooperation expansion with partners.
The two giants have been cooperating at the Arctic oil sites since 2011, as well as the joint development of an oil deposit in the Black Sea. In June 2012, Rosneft also struck a deal with Exxon on the joint project of a tight oil deposit in Western Siberia.
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Exxon Mobil Corporation is a producer in the petroleum and petrochemicals business. Formed in November 1999, when Exxon and Mobil merged, the company is engaged in oil and gas exploration, production, supply, transport and marketing.