An international consortium developing two oilfields off Russia’s Sakhalin island, has approved a USD 8.9 billion plan to build what will be the world’s largest LNG plant. The Sakhalin Energy consortium, led by Royal Dutch/Shell, said the plant would be built by 2006 on the island off Russia’s Pacific coast. The investment plan represents a record foreign investment by a single energy group in Russia and was earlier approved by the Russian government. The money will be used to develop the two offshore Sakhalin fields and to build oil and gas pipelines to the south of the island, where the new plant will produce up to 9.6 million tonnes of LNG annually. The output will be shipped to Japan, South Korea and Taiwan. The consortium, in which Shell owns 55%, Japan’s Mitsui & Co and Mitsubishi Corp. 25% and 20% respectively, will start constructing the plant in 2002 but is yet to raise the money. Sakhalin Energy has already invested USD 1.6 billion in the first stage of the project, which is currently producing about 35,000bpd.
