Japan utilities get contract offer from new Russian operator of Sakhalin-2
17/08/2022 11:15
TOKYO, Aug 17 (Reuters) - Japanese gas and electric
utilities with long-term contracts to buy liquefied natural gas
(LNG) from the Sakhalin-2 project in Russia have received a new
contract offer from the newly-formed Russian operator, some
companies said on Wednesday.
The Russian entity was registered on Aug. 5 to replace the
project operator Sakhalin Energy as Moscow re-writes rules for
foreign firms operating in the country amid global sanctions
after its invasion of Ukraine. urn:newsml:reuters.com:*:nL1N2ZG0Y5
For resource-poor Japan, the project is an important source
for its energy security. It buys about 9% of its LNG from
Russia, mainly from Sakhalin-2.
"We have received a new contract from a new Russian entity
in early August, but there is no deadline for us to sign it,"
said a spokesperson at Japanese gas supplier Saibu Gas Holdings
9536.T .
"We are examining details of the contract to decide whether
or not we would sign it," he said, without revealing details of
the contract. Saibu buys 65,000 tonnes of LNG annually from
Sakhalin-2 and it has already received the cargo for this year
in July.
Tohoku Electric Power 9506.T has also got a new contract
from the new entity, while Kyushu Electric Power 9508.T has
received a notification of the transfer from the new entity on
Aug. 10, their spokespersons said, adding they are considering
whether to continue their contracts.
Tokyo Gas, Japan's biggest city gas supplier, has been
contacted by the new entity about a contract, a spokesperson
said, but declined to comment on details due to confidentiality.
Other buyers JERA, Toho Gas 9533.T and Hiroshima Gas
9535.T declined to comment.
UPSTREAM STAKES
A Russian government decree signed in early August gave
foreign investors in the project - Shell SHEL.L and Japanese
trading houses Mitsui & Co 8031.T and Mitsubishi Corp 8058.T
- a month to claim their stakes in the new entity, meaning the
deadline is Sept. 4.
The Japanese government has repeatedly said it wants the
trading houses to retain their stakes and has asked Mitsui and
Mitsubishi to "think positively" in joining the new Russian
entity. urn:newsml:reuters.com:*:nL1N2ZH05J
On Wednesday, the new industry minister Yasutoshi Nishimura
met Mitsubishi President Katsuya Nakanishi and asked him to
consider involvement in the new Russian company.
"We have not heard of any new conditions that would make
signing a contract for Sakhalin-2 project a difficulty,"
Nishimura told reporters.
Mitsubishi will consider the issue from a comprehensive
perspective, a spokesperson said after the meeting, pointing to
the government's request, business risk and economic rationality
among other factors.
(Reporting by Yuka Obayashi; Editing by Kim Coghill)
((Yuka.Obayashi@thomsonreuters.com; +813-4520-1265;))