Cosmo Oil to Sell Stake in Sakhalin-1

Cosmo Oil Company would like to sell its drilling rights in the Sakhalin-1 oil development project in Russia, in order to focus on other core projects in the Uinted Arab Emirates and Australia.

Cosmo would most likely sell its stake to either Japan Petroleum Exploration Co., Itochu or Marubeni. Cosmo Oil owns a 1.13% stake in Sakhalin Oil & Gas Development Co., or SODECO, which holds 30% of the drilling rights in the Sakhalin-1. Cosmo estimates the value of the drilling rights at Y250 million

"We have actively taken part in the projects in the UAE and Australia...Liquidating a partial stake in the Sakhalin-1 will help us place our oil development business focus there," a Cosmo company spokesperson said.

The Sakhalin-1 oil development project is being carried out by a consortium led by ExxonMobil Corp. The consortium plans in late 2005 to start commercial oil production in Sakhalin-1 offshore oil and gas field, with output expected to reach a maximum of 250,000 barrels a day of low-sulfur, light crude oil.