Shell, Japan firms may get stake in Gazprom’s Baltic LNG, report says

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Russian gas company Gazprom may offer up to 49 percent in its Baltic LNG project to a strategic partner and the most likely candidates are Royal Dutch Shell or a consortium of Japanese firms, Russia’s Kommersant newspaper said on Wednesday.

The agreement may be signed this week during an economic forum in Russia’s second city of St Petersburg, it reported, quoting sources in the gas industry.

Gazprom declined to comment.

The gas producer plans to build a liquefied natural gas plant in the Baltic sea port of Ust-Luga with an annual capacity of 10 million tonnes. It also wants to be able to increase output to 15 million tonnes a year.

An Ust-Luga port official said on Tuesday the company may need around 1 trillion roubles ($18.50 billion) to build the plant.

Shell and two Japanese firms, Mitsui and Mitsubishi, are Gazprom’s partners in the Sakhalin-2 LNG project, which has an annual capacity of around 10 million tonnes. Shell wants to increase it by another 5 million tonnes.

An official from Gazprom said on Tuesday any decision on expanding Sakhalin-2 would not come before 2016.