Russia: ExxonMobil Announces Odoptu Production Startup at Sakhalin-1 Project

Exxon Mobil Corporation announced today the startup of production from the Odoptu field at the Sakhalin-1 project offshore northeastern Russia.

ExxonMobil subsidiary Exxon Neftegas Limited (ENL) is operator on behalf of the five-company international Sakhalin-1 Consortium.

“The project applies industry-leading technology to successfully operate in a safe and environmentally responsible manner in one of the most challenging sub-arctic environments in the world, while providing important economic benefits to Russia”

The Odoptu field is expected to add up to 11 million barrels (1.5 million tons) to Sakhalin-1 oil production in 2011. The startup is on schedule and within development cost expectations.

“This is yet another milestone in Sakhalin-1 project achievements,” said Neil W. Duffin, president of ExxonMobil Development Company. “The Sakhalin-1 project is one of the largest energy investments in Russia and is a testament to international cooperation.”

“The project applies industry-leading technology to successfully operate in a safe and environmentally responsible manner in one of the most challenging sub-arctic environments in the world, while providing important economic benefits to Russia,” said Duffin.

Development of the Odoptu field has included world-class performance in the drilling and completion of seven extended-reach wells. The Sakhalin-1 project employs one of the world’s most powerful land-based rigs, which drilled horizontally under the Sea of Okhotsk to the Odoptu oil reservoir over five miles (nine kilometers) offshore.

Additional activities in the development of Odoptu included the construction of a new onshore oil and gas treatment facility and flowline connection to the existing Chayvo onshore processing facility.

The Sakhalin-1 project includes the phased development of the Chayvo, Odoptu and Arkutun-Dagi fields, with an estimated total resource of 2.3 billion barrels (307 million tons) of oil and 17 trillion cubic feet (485 billion cubic meters) of natural gas. The Chayvo field, which was the initial phase of the Sakhalin-1 project, began production in 2005.

Future project phases call for the development of the Arkutun-Dagi field as well as expanded gas production and sales from the Chayvo field. These later project developments will sustain production well into the future.

Since startup, the Sakhalin-1 project has produced over 270 million barrels (35.4 million tons) of oil for export to world markets. It also has been a key supplier of over 210 billion cubic feet (6 billion cubic meters) of associated natural gas to customers in Khabarovsk Krai, in far eastern Russia, to heat homes and meet growing energy needs. The project will continue to help meet future natural gas demand in this region.

The Sakhalin-1 Consortium includes ENL (30 percent interest); Sakhalin Oil and Gas Development Co. Ltd. (SODECO, 30 percent); affiliates of Rosneft, the Russian state-owned oil company, RN-Astra (8.5 percent), Sakhalinmorneftegas-Shelf (11.5 percent) and Oil and Natural Gas Corporation (ONGC) Videsh Ltd. (20 percent).

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Source: Exxonmobil,September 29, 2010,