ExxonMobil Makes Major Commitment to Sakhalin I Project

ExxonMobil Corp. is planning to invest $750 million this year to develop the Sakhalin-I oil and gas field located north of Japan, a company official, Rex Tillerson, said. "Work on the first stage of the Sakhalin-I project will show the international community that a large investment project can go ahead in Russia," he said. The money would be used to install drilling equipment on the Chaivo oilfield as well as upgrading the sea platform Orlan.

The three offshore fields in the Sakhalin-I project, Chaivo, Odoptu and Arkut-Dagi, are estimated to contain 307 million tons of oil and 485 million cubic meters of gas. They are to be operated by an international consortium in which ExxonMobil and Sakhalin Oil and Gas Development (SODECO) each hold a 30 percent stake. The other investors are ONGC Videsh and two subsidiaries of Rosneft.

The consortium has already invested $450 million in a five-year drilling program, and the overall investment in the project is expected to be around $12 billion over 30 to 40 year period.