Sakhalin-1 Project: Delivering Excellence in Project Execution

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Case Details:

Case Code : OPER093
Case Length : 26 Pages
Period : 1993-2009
Organization : Exxon Neftegas Limited / Sakhalin-1 consortium
Pub Date : 2010
Teaching Note :Not Available
Countries : Russia
Industry : Oil & Gas Industry

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Introduction Contd...

"We are extremely proud of the Sakhalin-1 project achievements. The Sakhalin-1 project is one of the largest energy investments in Russia and is a testament to international cooperation to successfully execute this project in one of the most challenging Arctic environments in the world in a safe and environmentally responsible manner."5

The Sakhalin-1 Project is one of the largest oil and gas development projects in the world. Located on the northeast shelf of Sakhalin Island, the project comprises three offshore oil fields, the Chayvo, Odoptu, and Arkutun Dagi. The total oil and gas reserves of the fields are estimated to be about 307 million tons (2.3 billion barrels) of oil and 485 billion cubic meters (17.1 trillion cubic feet) of natural gas.

The project is operated by Exxon Neftegas Limited6 (ENL), a subsidiary of ExxonMobil, on behalf of an international consortium comprising Russian, Indian, Japanese, and US oil and gas companies.

The project was declared commercial in October 2001, and the development of oil and gas from the fields began in 2005.

In the first phase of development of the project, oil was produced from the Chayvo field using both onshore and offshore facilities. These facilities included the construction of one of the world's largest land-based drilling rigs, an offshore drilling platform, an onshore oil and gas processing facility, a crude oil pipeline, and an oil export terminal. Initially, the project produced up to 50,000 barrels of oil and 60 million cubic feet of natural gas per day...

Excerpts >>

5] "Sakhalin-1 Project Receives Award for Excellence from International Petroleum Technology Conference,", December 3, 2008.

6] Exxon Neftegas Limited (ENL) is a subsidiary of ExxonMobil Corporation. It is the operator of the Sakhalin-1 Project and holds an interest of 30% in the project.


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