Press Release Back Number(2007)

Chubu Electric Concludes Purchase Agreement for LNG from Sakhalin II Project

August 3, 2007
Chubu Electric Power Co., Inc.

Chubu Electric has concluded an agreement with Sakhalin Energy Investment Company Ltd. to purchase LNG from the Sakhalin II Project. The companies reached a basic agreement originally on July 12, 2006 and had been working out details since then. Their efforts culminated in the signing of the purchase agreement on August 2 this year in Moscow.


The Sakhalin II Project brings natural gas from a gas field offshore the island of Sakhalin of the Russian Federation, and liquefies the gas for export at a base in Prigorodnoye located on the south of the island. Yearly capacity of the project is estimated at 9.6 million tons.


This marks the first LNG project in the Russian Federation, and will allow Chubu Electric Power to diversify and further stabilize sources of LNG by buying gas from the project, which is located extremely close to Japan.


< Basic agreement outline >

Seller:

Sakhalin Energy Investment Company Ltd.


Buyer:

Chubu Electric Power Co., Inc.


Period of contract:

15 years, starting April 2011


Contracted volume:

Approx. 500,000 tons / year


Delivery conditions:

Ex-ship
The seller arranges for the ship and delivers LNG to the buyer's receiving facility

*There have been no changes from the " Basic agreement outline, " subject of a press announcement on July 12, 2006.



< Reference >

< Sakhalin Energy Investment Company Ltd. >

Company name:

Sakhalin Energy Investment Company Ltd.


Established:

April 1994


Head Office address:

Yuzhno-Sakhalinsk, Sakhalin Oblast, Russian Federation


Chief Executive Officer:

Ian Craig


Ownership:

Gazprom 50% +1 share
Shell 27.5% -1 share
Mitsui & Co. 12.5%
Mitsubishi Corporation 10%


< Location of Sakhalin II Project liquefaction and shipping base >