Russia: LNG Supply To Japan As Normal; May Up Shipments

Russian shipments of liquefied natural gas to Japan remain unaffected despite Friday's devastating earthquake and supplies to the Asian nation may be increased, the operator of Russia's LNG plant on the Pacific coast said Tuesday.

Sakhalin Energy, which runs the Sakhalin-2 LNG plant, sent its latest LNG tanker to Japan Saturday and the shipment was received without problems, a Sakhalin Energy spokesman said.

Sakhalin Energy, which is controlled by Russian state gas firm OAO Gazprom (GAZP.RS), is talking to buyers about redirecting LNG shipments to Japan from other export destinations as part of relief efforts for the country, the spokesman said.

He added that the issue is complicated by limited capacity in Japan to generate electricity from extra LNG volumes.

Sakhalin Energy produced some 10 million metric tons of LNG last year, of which approximately 60% is exported to Japan.

Sakhalin Energy is controlled by Russian state gas firm OAO Gazprom (GAZP.RS) with Royal Dutch Shell PLC (RDSA) and Japan's Mitsui & Co. (8031.TO) and Mitsubishi Corp. (8058.TO) as minority partners.

-By Jacob Gronholt-Pedersen, Dow Jones Newswires; [phone]; [e-mail]