Sakhalin Secures $1.4B in Largest Russian Project Financing

Sakhalin II Location
(Click to Enlarge)

Sakhalin Energy, a company jointly owned by OAO Gazprom (Gazprom), Royal Dutch Shell plc (Shell), Mitsui & Co., Ltd. (Mitsui) and Mitsubishi Corporation (Mitsubishi) with Mitsui holding a 12.5% stake, signed a US $1.4 billion project finance contract with a consortium of international commercial banks. This finance contract is a significant milestone for the Sakhalin II project.

Nippon Export and Investment Insurance (NEXI), an export credit agency owned by the Japanese government, will provide overseas united loan insurance (investment and loan insurance for natural resources and energy). Based on the project finance contract and the NEXI insurance, the consortium banks will provide Sakhalin Energy with fund totaling US $1.4 billion. In this context, Mitsui, along with other shareholders of Sakhalin Energy, signed a sponsor guarantee contract providing guarantees for the loan until the completion of the project.

Sakhalin Energy already signed a US $5.3 billion project finance contract with Japan Bank for International Cooperation (JBIC) and a consortium of international commercial banks in June, 2008 to fund a part of the development cost of the project. The US $1.4 billion this time is additional funding and will be used to finance the completion of the full scope of works of the Sakhalin-2 Phase II project, including the ongoing drilling program for gas and oil production.

This additional funding will contribute to the stability and economics of the project and, eventually to the energy security of Japan.


Related Companies

Our Privacy Pledge

Most Popular Articles

From the Career Center
Jobs that may interest you
Technical Services Manager - Production Chemicals
Expertise: Chemist|Production Engineering|Stimulation
Location: Midland, TX
United States Houston: R&D Cementing Engineer - Petrophysical Applications
Expertise: Chemical Engineering|Mechanical Engineering|Petroleum Engineering
Location: Houston, TX
Land GIS Spatial Analyst - Mineral Land
Expertise: Contracts Engineer|Geologist|Lease Analyst
Location: Denver, CO
search for more jobs

Brent Crude Oil : $48.06/BBL 2.51%
Light Crude Oil : $45.77/BBL 2.17%
Natural Gas : $2.97/MMBtu 2.30%
Updated in last 24 hours