Japan invests further in Sakhalin-1 Consortium and the Kola Superdeep Borehole with Russian drilling technology

On March 24, 2016 it was announced a consortium of Japanese banks have invested a total of US$900 million along with the Japan Bank of International Cooperation into the Sakhalin-1 oil and gas consortium on the Sakhalin Island. The Japan Bank of International Cooperation is wholly owned by the Japanese government and the three Japanese banks involved have come in on the loans as co-financiers. This way the entire investment is completely controlled by the Japanese who have always had a hard time working out contracts with the Russians.

The Sakhalin-1 Consortium consists of three oil and gas fields: Chayvo; Odoptu; Arkutun-Dagi.  All three are located in extreme sub-Arctic conditions off the northeastern coast of Sakhalin Island in the Russian Far East. Significant benefits to Russia include billions of dollars in revenue, domestic natural gas supplies, employment and contracting opportunities and local infrastructure modernization. Benefits to Japan are a cheap energy source, possible pipeline construction and related construction projects to further develop the Sakhalin-1 oil and gas field.

Russian deep oil well drilling at the Sakhalin-1 site reached peek oil production of 250,000 barrels a day in 2007, but because of advanced deep well drilling developed by Russian oil engineers, it appears the wells will further produce an estimated 2.3 billion barrels of oil and 485 billion cubic meters (17.1 trillion cubic feet) of natural gas. An interesting side light here is that the Russians know that oil is abiotic and explains the development of their advanced engineering to bore out very deep old wells to extract oil where wells were thought to have “gone dry”. The deepest artificial hole drilled into the earth’s crust, was drilled by the Russians at the Kola Superdeep Borehole in the Pechengsky District, on the Kola Peninsula. Exxon Neftegas Ltd (ENL) on the Sakhalin-1 site has completed drilling the world’s deepest well going deeper than the Kola Superdeep Borehole in the Chayvo oil field on the Sakhalin shelf in the Russian Far East.

It was the Russians who proved the “peak oil scam” years ago and it looks as though the Russians are getting ready to dominate the oil industry over the next 100 years. Sort of makes Colin Campbell and his book The End of Cheap Oil look like a buffoon, but maybe he is, he came out of Oxford and that place has a thing against humanity. It will probably be a surprise to most readers, but it is alleged the Soviet KGB penetrated the University of Pennsylvania’s research into Russia’s energy potential years ago, and it is apparently this research that Russia’s Vladimir Putin is currently using in asserting Russia’s geopolitical oil and gas energy strategy. Putin didn’t have Mikhail Khordorkovsky arrested for monopolizing Yukos Oil Company, Putin had Kordorkovsky arrested because he was stealing Russian oil drilling technology. Sort of looks like now Wall Street has been cheated out of cheap oil and big profits for its grubby little shareholders. And it also looks like eternal control and conquest over the Middle East by the Anglo-Americans is no longer a possibility. With only six percent of the world’s population, the US consumes more than 25 percent of world oil production, or around 20 million barrels per day, most of it consumed by its military, while Russia consumes a third of that.  And further more, here is something to be really cause for concern. Russia is in North Korea drilling exploratory oil wells. Imagine North Korea’s military having access to oil and gas revenue?

Exxon Neftegas Limited (ENL) is a subsidiary of ExxonMobil with ENL as the operator. Two Russian, one Japanese and one Indian company are partners in the Sakhalin-1 Consortium. ExxonMobil (American) owns 30%; Sakhalin Oil & Gas Development Co. Ltd. (Japanese) owns 30%; ONGC Videsh Ltd. (India) owns 20%; Sakhalinmorneftegas-Shelf (part of Rosneft) owns 11.5%; RN-Astra (a Russian closed joint stock company) owns 8.5%. Japan’s participation through the Japan Bank of International Cooperation through investment in the Sakhalin-1 Consortium is for continued access to oil and natural gas. Because of western sanctions against Russia, large western oil firms have significantly reduced operations in Russia which Vladimir Putin responded to with a giant state oil services company to keep the industry stable, which is in Russia’s best interests. Maybe economic sanctions against Russia were far more beneficial to Russia than originally thought?

Oil rig work is the most dangerous work there is…so give these guys a salute when you pull up to a gas station to fill your car with cheap gas.

Drilling Rig Accidents in Russia compilation 3


Source: Russia Beyond the Headlines

Japanese banks to provide loan of $900 million to Sakhalin-1

March 24, 2016

The proceeds will be used to finance the Odoptu Field Stage-2 development.

Сахалин 2, мега-постројење за производњу течног природног гаса на руском Далеком Истоку. Извор: Gazprom.

Japan Bank of International Cooperation and Japanese Sakhalin Oil and Gas Development Co, Ltd (SODECO) signed an agreement on March 22 for a loan of up to $450 million.

The loan is co-financed by Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation and Sumitomo Mitsui Trust Bank, Limited, with co-financing totaling up to $900 million.

The proceeds will be used to finance the Odoptu Field Stage-2 development, part of the Sakhalin-1 project in which SODECO is participating.