Japan Retains Investment In Russia’s Sakhalin-1 Oil And Gas Project

The Japanese government has requested the consortium owning the stake in Sakhalin-1 to retain investment, amid fuel dependency.

• In August, Putin signed a decree to transfer operations of the Sakhalin-1 oil and gas project to Russia, while foreign stakeholders had one month to declare if they’ll maintain their stakes in the new company.
• Japanese firms also kept the stake in the Sakhalin-2 LNG export plant, to ensure LNG supply for the winter and to avoid having to buy costly spot cargoes. The total contracted volume is 5mn metric tons a year, equivalent to around 7% of Japan’s annual LNG imports.
• Japan’s LNG imports totalled 74.3mn t in 2021.
• The Japanese government has recently taken steps to support the county’s energy security.
• Since the government’s decision to phase out nuclear, amid the 2011 Fukushima nuclear disaster, Japan became one of the world’s largest LNG importers.