Exxon Mobil Corporation (NYSE:XOM) today announced that phase one
of the Sakhalin-1 project offshore Eastern Russia, led by its
subsidiary Exxon Neftegas Limited, and including affiliates of
Rosneft, RN-Astra and Sakhalinmorneftegas-Shelf, Sakhalin Oil and Gas
Development Co., Ltd. and ONGC Videsh Ltd., has reached its targeted
peak production rate of 250,000 barrels (34,000 metric tons) of oil
per day.
Phase one of the project consists of the Chayvo field onshore
processing facility and a 140-mile (225-kilometer) pipeline to
transport crude west across Sakhalin Island and the Tatar Strait to
the DeKastri terminal in the Russian Far East, where it is exported to
international buyers. Natural gas production for the peak winter
season in 2007 has been 140 million cubic feet (3.92 million cubic
meters) per day and is being marketed to two domestic customers in the
Khabarovsk Krai.
The Sakhalin-1 project includes three offshore fields: Chayvo,
Odoptu, and Arkutun Dagi and is an important multiphase investment
that addresses the challenge of meeting the world's growing energy
demand. The project is a significant example of how technology,
know-how and a staged long-term investment approach are helping to
develop energy resources in the most cost-effective, efficient, and
environmentally-sound way possible.
Sakhalin-1 is one of the largest single foreign direct investments
in Russia. Project benefits to Russia will include direct revenues to
the Russian State estimated at more than US$ 50 billion over the life
of the project, improvement of infrastructure, technology transfer and
the use of Russian suppliers for contracts, procurement, and
workforce. Commercial development brings with it a contribution of US$
100 million to the Sakhalin development fund over a five-year period.
The project will also bring production bonuses of US$ 45 million. The
Russian content of contracts awarded to date for the Sakhalin-1
project has exceeded US$ 3.6 billion.
"ExxonMobil, through the operatorship of Exxon Neftegas Limited,
is pleased that the Sakhalin-1 Consortium achieved its production goal
for peak crude oil operations in a timely manner," said Stuart McGill,
Senior Vice President of Exxon Mobil Corporation. "Achieving this
production milestone is a significant example of how the energy
industry and exporting nations can work together to provide needed
energy supplies to global markets."
Exxon Neftegas Limited is operator for the Sakhalin-1 project
(ExxonMobil interest 30 percent), which includes affiliates of
Rosneft, the Russian state-owned oil company, RN-Astra (8.5 percent),
Sakhalinmorneftegas-Shelf (11.5 percent); the Japanese company
Sakhalin Oil and Gas Development Co., Ltd. (30 percent); and the
Indian state-owned oil company ONGC Videsh Ltd. (20 percent).
CAUTIONARY STATEMENT: Estimates, expectations, and business plans
in this release are forward-looking statements. Actual future results,
including production rates and sales volumes, cost efficiencies,
project plans, schedules, and costs, and commercial arrangements could
differ materially due to changes in long-term oil and gas price levels
or other market conditions affecting the oil and gas industry;
political or regulatory developments; reservoir performance; timely
completion of development projects; technical or operating factors;
the outcome of commercial negotiations; and other factors discussed
under the heading "Factors Affecting Future Results" included in Item
1 of ExxonMobil's most recent Form 10-K and posted on our website
(www.exxonmobil.com).
