Russia Govt Decides to Set Up New Operator of Sakhalin-2

Economy

Tokyo, Aug. 4 (Jiji Press)--The Russian government has decided to set up a new company to operate the Sakhalin-2 oil and natural gas development project, according to Russia's state-run ITAR-Tass news agency and other media outlets.

Japanese trading houses Mitsui & Co. <8031> and Mitsubishi Corp. <8058>, both involved in the project in the Russian Far East, need to decide within a month of the new company's establishment whether they will agree to investments decided according to their stakes in the current operating company.

The Russian government issued a decree on the establishment of the new company Tuesday, according to the media reports Wednesday.

The new company, to be set up in Yuzhno-Sakhalinsk on the island of Sakhalin, will be headed by the top representative of Sakhalin Energy Investment Co., the current operator.

Russia's state-run Gazprom will hold around a 50 pct stake in the new company as it does in the current operator.

[Copyright The Jiji Press, Ltd.]

Jiji Press