Gazprom-Shell LNG JV Extends Russian Licences

The Gazprom-led Sakhalin Energy consortium has secured licence extensions for its Piltun-Astokhskoye and Lunskoye fields in the Sea of Okhotsk in the Russian Far East, it said on June 18. The licences, originally issued in May 1996, have been extended by five years until May 2026. 

Sakhalin Energy's shareholders are Gazprom, with 50% plus one share, Shell with 27.5% minus one share, and Japan's Mitsui and Mitsubishi with 12.5% and 10% respectively. The group produces oil and gas from Piltun-Astokhskoye and Lunskoye, together comprising the Sakhalin-2 project, under a production-sharing agreement. Under this contract, they can secure an additional five-year extension for their field licences until 2031.

The group exports LNG from the 11mn mt/yr Sakhalin LNG export plant, which is operating at half-capacity now owing to maintenance. There have been plans to expand the capacity by adding a third train, conditional on securing access to more long-term gas. Five years would not qualify as long-term for an LNG project and although the question has cropped up at conferences over the years, there was no mention of the expansion in the statement.