(MENAFN - Kuwait News Agency (KUNA)) Russia's state-run Gazprom, the world's largest gas producer, decided to build a plant for liquefied natural gas (LNG) near the city of Vladivostok, far east of the country, with a hope that it would start operations in 2018 in order to boost shipment to Asia.
After examining the basic plan as well as the profitability of the plant, the Russian gas monopoly concluded on Thursday that the project in the city of Vladivostok is feasible, the Nikkei Shimbun said. Gazprom also plans to set up a company by the end of next fiscal year for building the plant, the newspaper said.
The plant is expected to produce a maximum of 150 million metric tons of LNG per year. Last September, Gazprom and the Japanese government signed a memorandum of understanding to cooperate on the early construction of the plant.
Gazprom has already agreed in principle to build the plant in Vladivostok jointly with Japanese partners, including Itochu Corp. and Japan Petroleum Exploration Co. The decision is seen as Gazprom's indication that it would like to execute an official agreement on joint construction with these partners, the report added.
Japan is the world's No. 1 LNG importer, taking in a record 87.3 million tons in 2012. Following the nuclear accident at the Fukushima Daiichi power plant in March 2011, demand for LNG from Japanese utilities for thermal power generation has surged.