Russia , Japan and India

 In an Anti-West move Japan has declared that it will continue energy cooperation with Russia and will maintain stake in Russia's Sakhalin-1 oil project. 

But did you know that India is protecting Japan in this project from Russia and Japan is shielding India from West, How? 

let’s understand the consortium of Sakhalin 1 before March 2022. 

30% Exxon Mobil US

30% Japanese companies 

20% ONGC India 

20% Russian companies

Exxon, main operator of this project withdrew after Ukraine conflict and Putin transferred operation to Russia. So now a new Russian legal entity will take over the rights and responsibilities of the current investor consortium and the operator. 

Foreign stakeholders will have to declare if they’ll maintain their stakes in new company, who opts out will be eligible for compensation. India’s ONGC Videsh has 20% stake and it is considering taking on additional stakes after Exxon’s exit.

Sakhalin 1 project has been a money spinner for ONGC as for about a quarter of its proved reserves of 124.7 million tonnes comes from this project. Importance of Sakhalin 1 for Japan. 

“Japan is reliant on the Middle East for over 90% of its crude oil imports, Sakhalin-1 is an extremely important project as an alternative source outside the Middle East”

~ Yasutoshi Nishimura, Japan Economy, Trade and Industry Minister

Now Japan and India(ONGC) both want to take stake that was left by Exxon. 

Sakhalin1 is a huge project which was producing 220k barrels per day before Ukraine conflict. 

Output collapsed because Exxon declared force majeure and refused Russia’s insurance cover for tankers. Now with new Russian operator the production & shipment will restart & resume.

Since both Japan & India’s involvement in Sakhalin 1 project, U.S. cannot give moral lectures to India over ONGC’s profits, stake or India’s interest to take more stakes in project. Similarly Russia is also not threatening Japan over Sakhalin 1 like how they do with Sakhalin 2 project because Russia does not want to destabilise a project where India is involved. 

In Sakhalin 2 no Indian company is involved. Japan has shared an excellent relationship with India, especially under the late PM of Japan Shinzo Abe & Indian PM Narendra Modi. 

All though Japan is considered a subordinate state of U.S. it’s inspiring to see it work towards national interests unlike the European Union.