Russia, Japan ink LNG deal

MOSCOW (Commodity Online) : Russia and Japan on Monday signed an initial agreement to study the potential construction of a liquefied natural gas plant in Russia's Far East.

Russia’s gas giant Gazprom said the two sides would conduct a joint feasibility study into how LNG may be compressed in the region and then transported offshore from Vladivostok, the region's main city, to Asia.

The agreement -- which was signed by the company's chief executive Alexei Miller and Tetsuhiro Hosono, the head of Japan's Agency for Natural Resources and Energy -- provided no firm dates for the plant's potential construction.

A joint engineering design of the plant would be undertaken this year, Gazprom said in a statement.

The agreement came amid reports that the Japanese trading houses Mitsui and Mitsubishi were looking to take stakes in what could be Russia's largest natural gas project, planned for Siberia's remote Yamal Peninsula.

That gas would be exported from the northwest Siberian area, north of the Arctic Circle on the Kara Sea, to Europe and Asia by LNG carrier ships in the summer months, starting as early as 2020, a Japanese news report said.

Mitsui and Mitsubishi already participate in the Sakhalin-2 natural gas development project on Russia's Sakhalin Island (AFP).