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Japan fears China-Russia LNG alliance after Shell exits Sakhalin-2

Tokyo could see its import quotas reduced under new ownership

A Japanese-made liquefied natural gas carrier anchored near an LNG plant on the Russian island of Sakhalin.   © Reuters

BEIJING/TOKYO -- Energy giant Shell's reported talks with Chinese companies over its stake in the Sakhalin-2 project raise energy security concerns for Japan as possible Moscow-Beijing dominance in the project could end up reducing Japan's liquefied natural gas access.

Sakhalin-2, Russia's first LNG project, is operated by Russian gas giant Gazprom, which holds a roughly 50% stake. Shell, the No. 2 shareholder with a 27.5% stake, is reportedly holding joint talks with China National Offshore Oil Corp., China National Petroleum Corp. and China Petrochemical Corp. to sell its entire interest, according to U.S. and British media.

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