Exxon, Gazprom Could Seal Gas Deal This Year

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OAO Gazprom, Russia's state-controlled natural gas producer, could reach an agreement with Exxon Mobil, the largest U.S. oil company, to buy all natural gas from the Sakhalin-1 project operated by the Texas-based company, the Wall Street Journal reported.

Gazprom confirmed it wants to acquire the gas from Exxon Mobil by the end of this year, but the U.S. oil giant did not comment on the matter. Russia's OAO Rosneft, the country's largest oil company, India's ONGC Videsh Ltd. and Japan's Sodeco are also part of the Sakhalin-1 project.

Dow component Exxon (XOM) reserves export rights for the project, which is unusual because Gazprom has a monopoly on Russian gas exports. The company originally wanted to export the gas directly to China without involving Gazprom.

Gazprom is building a new pipeline from Sakhalin through Khabarovsk to Vladivostok that will be ready this year, but it will not be able to fill the pipeline with gas from its own Sakhalin-2 and Sakhalin-3 projects, the Journal reported. Gazprom said it wants to see the gas phase of the project developed quickly.