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Gazprom makes public its draft eastern strategy - 1

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YUZHNO-SAKHALINSK, September 27 (RIA Novosti) - Gazprom [RTS: GAZP] made public Wednesday a draft of its eastern strategy at an international conference in Russia's Far East.

"Taking into account the fuel and energy balance in the country's Far East, where coal is dominant, complete gasification is not planned," Viktor Timoshilov, head of the Russian energy giant's eastern projects department, said.

Nonetheless, in its strategy Gazprom proposes establishing a unified gas transportation system on the basis of four gas-producing centers in Siberia and the Far East. The company said the system will provide for the country's domestic needs and will be involved in exporting natural gas and liquefied natural gas (LNG) from Sakhalin Island.

"We plan both pipeline deliveries to our consumers and LNG deliveries, and we intend to significantly increase our production capacity and build new plants in other Far Eastern regions," Timoshilov said.

He also said natural gas would be delivered to China from West and East Siberia, and that LNG would be supplied to Japan, Korea and other Asia Pacific countries.

Russia's Sakhalin II project, which is run by the Sakhalin Energy Investment Company and operated by Royal Dutch Shell, comprises an oil field with associated gas, a natural gas field with associated condensate production, a pipeline, a liquefied natural gas plant and an LNG export terminal. The two fields hold reserves totaling 150 million metric tons of oil, and 500 billion cubic meters of natural gas.

The Russian energy giant has been pursuing a 25+1% share in the Sakhalin project in return for a 50% stake in the massive West Siberian Zapolyarnoye-Neocomian project.

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