Sakhalin Energy: Production Localisation as Effective Way to Adapt to New Reality

Faced with the COVID-19 pandemic and other external challenges, companies in the fuel and energy sector still have potential for growth. Localisation of business is among the most effective ways to accomplish that. This and other topics were discussed by the participants of the Adapting to New Reality focus session hosted by the Sakhalin-2 project operator on the second day of the Sakhalin Oil and Gas 2021 conference.

The session was attended by Roman Dashkov, CEO of Sakhalin Energy, Vladimir Sidorenko, Deputy Chairman of the Sakhalin Oblast Government, and the heads of Sakhalin-2 contractors: Alexey Samsonenko of Yokogawa Electric Sakhalin LLC, Sergey Popsuev of Island General Services LLC, and Grigory Trofimov of Promsystemy LLC. Together, they looked back on the year 2020 with the world entering a new socio-economic paradigm triggered by the pandemic.

"Our teams' resilience and professionalism, their ability to make quick decisions, revise their plans, and adjust the tasks at hand were put to the test. It is true that every company has a development strategy that should not change, but tactical actions need to be adapted to external conditions," said Roman Dashkov.

According to him, the company had predicted the consequences of the pandemic, demonstrated a proactive approach to the mobilisation of its staff, and took advantage of the digital platform already in place at Sakhalin Energy to make some of its services and functions available as remote support. Thanks to its concerted efforts, the company produced and shipped to its buyers an unprecedented 178.6 standard LNG cargoes in 2020, a record-high number in the history of the Sakhalin-2 project.

"Last year all of us, the authorities and businesses included, successfully passed the endurance test of the pandemic, proving capable of operating in a tough external environment. The Oblast’s administration as well as its oil and gas companies were faced with the important task of ensuring business continuity. Together, we coped with it," added Vladimir Sidorenko.

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One of the key factors in Sakhalin Energy's successful adaptation to the new reality has been its commitment to developing Russian content, which the company has adhered to since its creation. In 2020, the Sakhalin Oil and Gas International Conference hosted the first ceremony of awarding diplomas to Russian contractors for their outstanding contribution to the development of Russian content within the Sakhalin-2 project. This year, it has been held for the second time. SMNM-VECO LLC and GazProektEngineering JSC received the Sakhalin-2 Project Partner award. Diplomas for personal contribution to the development of Russian content in the Sakhalin-2 project were awarded to Promsystemy LLC, INTRA Service Company LLC, Yokogawa Electric Sakhalin LLC, and Schlumberger Vostok LLC. Moreover, Island General Services LLC received the Sakhalin Industrial Park Project Partner award. All the above companies adhere to the policy of production localisation and expand their presence in the Sakhalin Oblast.

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30 September 2021