India’s Oil and Natural Gas Corp (ONGC) has applied to retain a stake in the new Russian operator of the Sakhalin-1 oil and gas project in the Far East, reported Reuters, citing a person familiar with the development.

Following the exit of previous operator ExxonMobil from the oil and gas project, Russia has established a new entity that is managed by a subsidiary of Russian entity Rosneft.

The Russian government ordered the new state-run company to decide the participation of foreign shareholders in the Sakhalin-1 project.

Through its overseas investment unit ONGC Videsh, ONGC owns a 20% stake in the project.

Prior to the launch of the new entity, Exxon and Japanese consortium Sakhalin Oil and Gas Development Co (SODECO) each owned a 30% stake in the project.

The Japanese government holds a 50% stake in SODECO while the remaining stake is owned by Itochu, Marubeni, Japan Petroleum Exploration, and Inpex.

Through Sakhalinmorneftegaz-shelf and R N Astra, Russian oil major Rosneft owns the remaining 20% interest.

Last week, SODECO decided to retain its stake in the project, which was producing 220,000bpd prior to Russia’s invasion of Ukraine in February 2022.

SODECO was urged by the Japanese Government to retain its stake in the Russian project to help ensure the country’s energy security.

According to industry sources, the new Russian entity is planning to restore oil production levels from the Sakhalin project in the near future.