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Putin Offers Japan LNG, Siberian Fields

The prime minister appearing on Sakhalin Island on Saturday to outline measures to provide “real help” to Japan. Sergey Mamontov

YUZHNO-SAKHALINSK &mdash Prime Minister Vladimir Putin on Sunday proposed freeing up energy for Japan by increasing gas supplies to Europe and offered Japanese companies a slice of Siberia's gas industry.

Putin, paramount leader of the world's biggest energy producer, offered Japanese companies stakes in two Siberian gas fields that have total reserves of about 3.2 trillion cubic meters, more than the world's annual gas consumption.

Putin said gas monopoly Gazprom was ready to raise gas deliveries to Europe by 60 million cubic meters a day to allow more liquefied natural gas cargoes to go to Japan.

"We will increase deliveries of pipeline gas to Europe while LNG tankers destined for Europe [can] turn around and head for Japan instead," Putin told a meeting in the Far Eastern city of Yuzhno-Sakhalinsk, 1,000 kilometers north of Japan's stricken Fukushima nuclear plant.

Russia will raise the proposal with the European Union in the near future, Putin's spokesman Dmitry Peskov told reporters.

"This is a case when the coordination of efforts by the global economic community is required," Peskov said. Russia supplies about a quarter of Europe's gas needs.

Putin's proposal, apart from indicating Russian concern at the impact of Japan's troubles on its future energy demand, may allow Moscow to claw back some gas sales in Europe from Qatar, which has been eating up Russia's market there.

Gazprom deputy chief executive Alexander Ananenkov said supplying European customers with 60 million cubic meters of pipeline gas would free up 40,000 tons of LNG.

"It is possible to do immediately, right now. Such a large-scale swap operation between Russia and the European Union will provide real help for Japan," Putin said.

Ananenkov said the proposal would involve European LNG buyers transferring the property rights for their LNG cargoes to Gazprom in the swap.

Putin said Japanese companies could discuss buying stakes in East Siberia's Kovykta gas field, which holds more than 2 trillion cubic meters of gas, and the Chayanda field in Sakha, which has reserves of about 1.2 tcm.

"We are offering Japanese companies the opportunity to enter some of the biggest energy projects of the Far East and Siberia, to invest capital and technology to develop large scale deposits such as Kovykta and Chayanda," Putin said.

Since Japan's devastating earthquake, Putin has ordered officials to speed up the development of energy projects in the Far East to cope with future demand from Japan.

Gazprom is planning to speed up work on the Sakhalin-3 energy project, and the Energy Ministry plans to speed up the oil pipeline, which takes East Siberian crude to Kozmino.

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