Sakhalin Locks in $5.3B in Largest Russian Project Finance Deal
Sakhalin Energy Investment Company Ltd., the Japan Bank for International Cooperation (JBIC) and a consortium of international commercial banks signed a project finance contract for Phase 2 of the world's largest integrated oil and gas development, Sakhalin II.
Japan's leading financial institution gave strong support to Sakhalin Energy, providing $3.7 billion. The consortium will contribute an additional $1.6 billion. The funds will finance the final stages of construction, testing and commissioning of Sakhalin II Phase 2, which will soon start delivering liquefied natural gas to customers in Japan, Korea and the North American West Coast.
"JBIC played a key role in providing project finance for our Phase 1 development," said Ian Craig, CEO of Sakhalin Energy. "I am therefore delighted that their involvement, supplemented by participation from international commercial banks, for this strategic project is being renewed for Phase 2. JBIC's involvement over the years, their support and, of course, their challenge, has encouraged the Company to set world-class standards for social and environmental performance and transparency in both the construction and production phases of the Project."
The Phase 2 financing sets a new record for Russia in terms of the amount raised and establishes new benchmarks for future Russian and international oil and gas developments.