Russian President Vladimir Putin on Friday signed a decree to create a new operating company for the Sakhalin 1 oil and gas project, according to Russian media.
With the signing, Russia will ask foreign stakeholders if they wish to remain part of the project, which is partly financed by the Japanese government and companies, including Itochu Corp. and Marubeni Corp., through Sakhalin Oil and Gas Development Co., or SODECO.
SODECO holds a 30 percent stake in the project, which started producing crude oil in 2005. The decree was quoted as stating that foreign business partners will have one month to decide whether to invest in the new company.
"It remains an important project for the stable supply of energy," a senior Japanese industry ministry official said Saturday, although Japan currently does not import crude oil from Sakhalin 1.
The government has said Japan, which is highly dependent on energy imports, will maintain stakes in the Sakhalin 1 and 2 energy projects, despite the imposition of economic sanctions on Russia since its invasion of Ukraine.
Exxon Mobil Corp. of the United States, a major stakeholder in Sakhalin 1, announced in March its withdrawal from the project in the Russian Far East.
A new operator has already been set up for Sakhalin 2, which accounts for around 9 percent of Japan's liquefied natural gas imports.
Russia has authorized investments by Japanese trading houses Mitsui & Co. and Mitsubishi Corp. in Sakhalin 2, while British oil major Shell PLC, which held an approximately 27.5 percent stake in the predecessor company, exited from the project.
Related coverage:
Russia OKs Japan firm's investment in Sakhalin 2 energy project
Mitsui, Mitsubishi to keep stakes in Russia Sakhalin 2 energy project
