Japan plans gas pipeline from Russia

Three Japanese firms are planning an 870-mile-long, offshore pipeline to bring natural gas from Russia's Sakhalin Island, the Asahi Shimbun reported Monday. When completed in five to seven years, the pipeline, estimated to cost up to $5 billion, would substantially reduce procurement cost, sources told the newspaper. It would link Sakhalin Island with the Tokyo metropolitan area, running through Hokkaido and along the Pacific coast of Japan's mainland, the newspaper said. Demand for natural gas has been rising as Japan cuts its reliance on nuclear power as a result of the earthquake-triggered March 2011 Fukushima Daiichi nuclear plant disaster. The three companies -- Tokyo Gas Co., Japan Petroleum Exploration Co. and Nippon Steel & Sumikin Engineering Co. -- have completed a preliminary feasibility study for the pipeline project, sources told the Asahi Shimbun. The report said a detailed survey and successful negotiations with local governments need to be completed before the project can proceed. The consortium companies already have outlined the project to Exxon Mobil Corp., which owns an interest in the Sakhalin I oil and gas development project, and government ministries concerned, the report said. The participating companies also plan to seek participation from electric power companies in the project as the imported gas is expected to be less expensive that liquefied natural gas imported by ships. The Japanese government also has plans to import LNG from Russia's Vladivostok.