Russia's Rosneft, With US Partner Exxon, On Track With LNG Plant

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Rosneft says it is on track to start production at its first LNG gas plant in the country's far east in 2018-2019, despite East-West tension over Ukraine.

Reuters

MOSCOW, April 1 (Reuters) - Russia's Rosneft, said on Tuesday it was on track to start production at its first liquefied natural (LNG) gas plant in the country's far east in 2018-2019, despite East-West tension over Ukraine.

The world's largest listed oil company by output signalled its partnership with U.S. ExxonMobil for building the plant, which will have an initial annual capacity of 5 million tonnes, would not be affected by the standoff.

"The project is fully targeting Asia-Pacific markets. At the moment, the project's implementation is going according to the plans that were announced," Rosneft, headed by Igor Sechin, a long-standing ally of Russian President Vladimir Putin, said in written replies to Reuters.

"The launch is planned for 2018-2019," said the state-controlled company, almost 20 percent owned by British oil major BP.

Rosneft said current LNG prices in Asia, at over $15 per million British thermal units (MMBtu), would enable it to successfully carry out its LNG project, in which the final investment decision is expected next year.

Russia is entering the global LNG game at a time when Qatar, Australia and others are boosting their presence on the market, and prices are being driven by growing demand in the Asia-Pacific region.

Russia has only one LNG plant, which is controlled by state-run top natural gas producer, Gazprom, and is on the Pacific island of Sakhalin. It has an annual capacity of around 10 million tonnes.


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