Russia approves gas production, delivery to Asia

Eric Watkins
Senior Correspondent

LOS ANGELES, Sept. 11 -- Russia's Industry and Energy Ministry has approved the Eastern Gas Program leading to the creation of a unified system for East Siberia's natural gas production and delivery to China and other areas in the Asia-Pacific.

The program will create four gas production centers in Sakhalin, Yakutia (Chayanda field), Irkutsk, and Krasnoyarsk territories, according to Anatoly Yanovsky, chief of the ministry's energy policy department in a Sept 7 announcement.

Ministry officials said "absolute priority" will be given to meeting domestic needs, while the dates of the fields' development and respective exports will depend on the outcome of commercial talks between the companies involved.

Industry analysts said approval of the ministry's program guidelines essentially ratifies OAO Gazprom's plans for the region, including construction of LNG facilities on Sakhalin Island and direction of gas supplies from the ExxonMobil Corp.-led Sakhalin-1 project to the domestic market.

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