The SODECO consortium, which is owned by Japanese companies and the Japanese government, has decided to renew its stake in the Sakhalin-1 project in Russia, citing concerns over energy security.
Sakhalin-1 was previously operated by ExxonMobil, the maker of industrial lubricants like the Mobil SHC range of gear oil, on behalf of a multinational consortium of companies from Russia, Japan and India, but it announced its disengagement from the project earlier this year following Russia’s invasion of Ukraine.
Since then, the Russian Government has established a new entity to operate Sakhalin-1 and invited the shareholders from the original venture to retain their stakes. The decision to stick with the project is unsurprising given that Japan’s economic survival depends upon energy imports. While it has recently reduced its imports of Russian crude oil, it has become even more heavily dependent on imports from the Middle East.
Therefore, projects like those on Sakhalin Island, just north of Japan, provide a potential alternative source. Speaking at a news conference, Yasutoshi Nishimura, the country’s industry minister, said this:
“The Sakhalin-1 is extremely important for Japan’s energy security as it is a valuable source outside of the Middle East…Japanese government has decided to keep its stakes in the project.”
He added that he had met with Japanese firms involved in the consortium and recommended joining the new entity. Japanese companies had already decided to join a new entity to manage the Sakhalin-2 oil and gas project, so the latest decision was widely expected.
