Sakhalin-1 Oil, Gas Production Less Than Half of Plan in 2022

Vladimir Soldatkin
Monday, February 27, 2023

Valery Limarenko, the governor of Russia's far eastern Sakhalin island, told President Vladimir Putin on Monday that oil and gas production at the Sakhalin-1 project was less than half of that planned in 2022. 

The project saw a sharp decline in output following the departure of U.S. oil and gas major ExxonMobil XOM.N after Moscow sent tens of thousands of troops into Ukraine on Feb. 24 last year. 

"First, in May, oil production was practically stopped, and in September, it was gas production. We lost a large amount, more than half, of the annual plan," Limarenko said at a televised meeting with Putin. 

Russia is trying to recover losses from the Exxon withdrawal and the local General Prosecutor's Office has been asking a court to recover 15.5 billion roubles ($220 million) in allegedly unpaid taxes from the company.

"Given that two-thirds of the (regional) budget consists of oil and gas taxes, we will lose about 50 (billion roubles, $663.6 million), 49 billion, according to our calculations. We will somehow get out, but this problem really exists," Limarenko told Putin. 

He had said in September that oil production of 4.2 million tonnes (84,000 barrels per day) was expected at the Sakhalin-1 project, down from a planned 8.9 million tonnes. An industry source told Reuters last month that Russia restored oil output at Sakhalin-1. 

Exxon took an impairment charge of $4.6 billion on its Russian activities in April. It also reduced local energy production and moved staff out of the country. 

Russia last year approved requests by India's ONGC Videsh, the overseas investment arm of state-run Oil and Natural Gas Corp , and Sakhalin Oil and Gas Development Co (SODECO), a consortium of Japanese firms, to retain their respective 20% and 30% stakes in the Sakhalin project. ($1 = 75.3500 roubles) 

(Reuters - Reporting by Vladimir Soldatkin / Editing by Gareth Jones and Louise Heavens)


Categories: Energy Activity Production Asia

Related Stories

Subsea7 Secures Work at Black Sea Field off Türkiye

PXGEO Nets First Seismic Survey off Malaysia

Norwegian Oil Investment Will Peak in '25

Cheniere, JERA Ink Long-Term LNG Sale and Purchase Agreement

ADNOC Signs Long-Term LNG Deal with Hindustan Petroleum Corporation

Sapura Energy Rebrands to Vantris Energy

PTTEP Buys Chevron's Hess Unit Share of Southeast Asia’s Offshore Block for $450M

Valeura Energy, PTTEP Partner Up on Gulf of Thailand Blocks

Sapura Scoops Over $118M for Chevron, PTTEP Subsea Ops off Thailand

BP Expands Oil and Gas Scope in Azerbaijan with New Projects and Exploration Rights

Current News

Technip Energies Gets FEED Job for Inpex’ Abadi LNG Project in Indonesia

Keppel, Seatrium in $53M Arbitration Case Over Brazil Corruption Scheme

Subsea7 Secures Work at Black Sea Field off Türkiye

CIP, Petrovietnam Team Up for Offshore Wind Project in Vietnam

Seatrium Signs FLNG Vessel Upgrade Deal for Golar LNG

EnQuest Enters Indonesia with Operatorship PSCs for Two Exploration Blocks

PXGEO Nets First Seismic Survey off Malaysia

SPE Offshore Europe 2025 set to drive transformational change for the energy sector

Shipbuilder Delivers Fast Crew Boat Pair to Aesen

Norwegian Oil Investment Will Peak in '25

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com