SAKHALIN-1 CONSORTIUM ANNOUNCES JOINT NOGLIKI AIRPORT MODIFICATION PLANS WITH SEIC
SAKHALIN, July 10, 2002 -- Exxon Neftegas Limited (ENL), operator for the Sakhalin-1 Consortium, announced today that the Nogliki airport civil works contract has been awarded to Transstroy Sakhalin, a Russian company based in Yuzhno-Sakhalinsk in the Russian Far East. This contract, which is managed by ENL, is jointly funded by ENL and Sakhalin 2 project developer Sakhalin Energy Investment Company.This contract adds to an already significant proportion of local content in the two major Sakhalin oil and gas projects. In the case of the Sakhalin-1 project, the total value of contracts awarded to Russian contractors and suppliers is estimated to total more than $US550 million since the project began in 1996.
Founded in 1989, Transstroy Sakhalin has specialized in construction of airports, including previous upgrades to the Yuzhno-Sakhalinsk airport, industrial, commercial and residential buildings, and highways. The company's General Director, Boris Tsykalov, was named an Honored Builder of Russia in 1994.
Work on improving and strengthening the Nogliki airport runway is expected to begin in July 2002. The contract will replace the present unpaved runway, taxiway and aircraft parking apron with concrete and asphalt facilities, and is scheduled for completion in November 2002.
According to Neil Duffin, President of ENL, awarding this major contract to a local Sakhalin company is tangible proof of the Consortium's commitment to maximizing the Russian content of the Sakhalin-1 project. "We are glad this contract has been awarded to a Russian company that proved to be well qualified for this type of work. We will continue to seek Russian expertise, and integrate our collective knowledge and skills to address the many challenges involved in this project."
The Sakhalin-1 project, the largest foreign direct investment project in Russia, has recoverable resources of approximately 2.3 billion barrels of oil and 17 trillion cubic feet of gas. The Sakhalin-1 Consortium plans to develop the project in four phases. The first phase, with development costs of around $US4 billion, will focus on planned oil production, with limited gas supplies available to help meet the Russian domestic demand. First oil production from the Chayvo field is scheduled to commence at the end of 2005, and reach a daily plateau rate of around 250,000 barrels.
In addition to ENL (30 % interest, operator), the Sakhalin-1 consortium members are the Japanese company Sakhalin Oil and Gas Development Co., Ltd. (30 %), Indian company ONGC Videsh Ltd. (20 %) and two Russian companies, Sakhalinmorneftegas-Shelf (11.5 %) and RN-Astra (8.5 %).
For more information, please contact Glenn Waller (Moscow 095 564-8950) or Michael Allen (Yuzhno-Sakhalinsk 4242 46 88 12)
Or logon to http://www.sakhalin1.ru