YUZHNO-SAKHALINSK, Russia, April 1 (UPI) -- The lauded Sakhalin-2 liquefied natural gas facility delivered its first shipments to Tokyo on Wednesday amid sagging demand in the energy market.
In February, Russia opened its first LNG plan on Sakhalin Island to supply mostly Asian markets with natural gas from the nearby facility.
Japan will purchase about 65 percent of the LNG from Sakhalin. South Korea and the United States signed contracts with Russia for gas purchases as well.
Russian officials expect the project to supply around 7 percent of the Japanese LNG imports, and officials on both sides praised the proximity of the facility to its intended markets.
The Wednesday launch, however, comes as many Asian customers predict a saturated LNG market and the use of flexible contracts, the Financial Times reports.
Meanwhile, with several oil and gas majors reporting modest gains in the global recession, officials with the managing consortium reacted warmly to the economic potential of the project.
"This sort of model, with Gazprom in the lead and companies like Shell (and others) providing technical expertise and probably some of the financial resources, could work very well there," said Ian Craig, chief executive of the Sakhalin Energy Investment Co.
