Shipments of liquefied natural gas to Japan from the Sakhalin-2 project in far eastern Russia are expected to begin early next year, partners in the project said Tuesday.
"We probably can start delivery in the first quarter," said a spokesman of Mitsubishi Corp. (8058.TO).
"Construction work is more than 98% completed, so we will be able to start delivery early next year," said a spokesman with Mitsui & Co. (8031.TO).
Mitsubishi Corp. has a 10% stake in the project, while Mitsui & Co. owns a 12.5%. Russia's OAO Gazprom (GAZP.RS) holds 50% plus one share, and Royal Dutch Shell PLC (RDSA) has 27.5% minus one share.
The Sakhalin-2 project, located offshore of Sakhalin Island, is expected have a production capacity of 9.6 million metric tons per year of LNG and about 90,000 barrels a day of crude oil. It will deliver LNG mainly to buyers in Japan and South Korea under long-term contracts.
The partners originally aimed to start delivery in 2008, but delayed afterwards the schedule to 2009 citing a shortage of resources. Russia briefly froze the project, citing environmental problems, and that is also believed to have contributed to the delay.