Secretary Evans Applauds Progress on Sakhalin I Project

Washington, DC - U.S. Commerce Secretary Don Evans applauded yesterday's announcement that the Sakhalin I Consortium will proceed with the development of three major offshore oil and gas fields near Sakhalin Island in northeast Russia.

The Sakhalin I Consortium is a project to tap plentiful oil and gas reserves in northeast Russia and bring them to the world market. The project is funded by investors from 4 countries and is expected to result in about $12 billion in capital investment, making it the largest direct foreign investment in Russia to date. A U.S. company, ExxonMobil, operates the Sakhalin I project on behalf of the international consortium.

"The Sakhalin I Consortium underscores exciting new opportunities for U.S. investment in Russia and sends a strong signal from Russia's leaders that foreign investment on a large scale is welcome. Similar successes on other Production Sharing Agreements would continue to strengthen Russia's position as a country that is interested in attracting large and complex investments. Russia is demonstrating a willingness to work with investors to make these types of projects succeed," Evans said.

Earlier this month, while leading a business development mission to Russia, Evans participated in a Moscow news conference announcing the first shipment of crude oil from the Caspian Pipeline Consortium. U.S. companies have invested over $1 billion in that project.

"President Bush has made strengthening our nation's economic relationship with Russia a priority of his administration. Stronger economic ties between the U.S. and Russia will promote economic growth, increased innovation, greater productivity and a better quality of life for all of our people," Evans said. "I will continue to work with my Russian counterparts to accomplish these goals."