Aiyar goes to Sakhalin for first oil production

Vol 9, PW 12 (22 Sep 05) News in Brief
     

Mani Shankar Aiyar will be in Sakhalin on 3rd October to mark first production from the Sakhalin-1 joint venture, where ONGC Videsh has a 20% stake.

OVL managing director RS Butola and joint secretary exploration Sunjoy Joshi are going with him. Operator ExxonMobil will begin pumping out an initial 25,000 b/d and some gas from the offshore Chayvo field but production is expected to rise to 250,000 b/d and 1bn cf/d by April 2007.

OVL also carries a 20% stake of Russian state-owned Rosneft. Original plans were for first production in 2006, but we are ahead of schedule, a source tells us.

All production will initially be sold within Russia, but India eventually wants to import its share of oil for domestic refineries. Sakhalin crude is the best in the world, we learn.

It is known as champagne crude. The high freight cost to India will be more than offset by the premium that can be charged to (Indian) refiners.