* Sechin LNG plan challenges Gazprom push into Asia-Pacific
* Putin told Sechin not to abuse Rosneft "monopoly" position
* Cabinet wants to privatise Rosneft stake
(Wraps stories on LNG, privatisation, adds Putin comments)
By Denis Dyomkin
ULAN-UDE, Russia, April 11 Rosneft and
ExxonMobil on Thursday unveiled details of a $15 billion
liquefied natural gas project to supply Asia-Pacific markets
that would challenge Gazprom's monopoly on Russian gas
The Russian and U.S. energy majors have agreed to study the
possibility of building the plant to liquefy gas from their
joint Sakhalin-1 oil and gas project off Russia's Pacific coast.
Rosneft President Igor Sechin, a long-time ally of President
Vladimir Putin, told the Russian leader by video link from
Sakhalin that the LNG plant could either be built on the island
or in the far-eastern region of Khabarovsk.
Production could start in 2018 - the same year that Gazprom
plans to commission its own LNG plant near the Pacific port of
Vladivostok - pitting the state energy giants against each other
in a battle for market share in China, Japan and South Korea.
"We are talking probably about $15 billion," ExxonMobil
Development President Neil Duffin told Putin, also via the video
link from Sakhalin.
Rosneft and South Korea's STX Corp are in talks
over building a fleet of vessels and platforms for Rosneft's
offshore projects, Sechin also said.
Putin reacted with caution to the ambitious plans laid out
by Sechin, warning him against "monopolising" Russia's oil and
Only Gazprom, according to a 2006 law, has the right to
export gas from Russia. Rosneft is, however, lobbying to win the
right to export LNG, as is Russia's largest independent gas
Putin so far has balked at moves to liberalise exports of
Russian gas, which could expose Gazprom to harsher domestic
competition at a time it has lost pricing power and market share
in its core European market.
Despite being one of the world's most profitable companies,
Gazprom has come under fire for failing to compete for market
share and for over-spending on investments, draining its cash
flow and pushing its market value below $100 billion.
Gazprom's weak performance has raised questions over whether
it can continue to fulfil the role in projecting Russia's energy
power that it has fulfilled throughout Putin's 13-year-old rule.
But Putin has stopped short of withdrawing his support for
Gazprom, and cautioned Sechin over Rosneft's aggressive
expansion and saying it should not abuse its dominant market
position in Russia's Far East.
"You really occupy practically a monopoly position," Putin
Sechin took over Rosneft last year after serving as the
government's "energy tsar" and has struck landmark exploration
deals with Exxon, Statoil and Eni to exploit
Russia's untapped Arctic offshore reserves.
Last month, Rosneft completed Rosneft's $55 billion takeover
of Anglo-Russian oil firm TNK-BP, creating the world's largest
listed oil firm producing the equivalent of 4.6 million barrels
per day in oil and gas.
Critics of the TNK-BP deal have said that it amounts to a
nationalisation, when the government's declared goal is to
reduce the state role in the economy by privatising assets.
In Moscow, Prime Minister Dmitry Medvedev's cabinet
announced plans to sell a 19 percent stake in Rosneft this year
as part of its broader privatisation efforts, a far larger stake
than previously envisaged.
Russia's plan to sell stakes in large firms and banks has
slipped behind schedule, but officials are showing greater
urgency to complete asset sales as a slowing economy dents tax
"I raised the issue during the government meeting that we
need to speed up the process of large-scale privatisation,"
Economy Minister Andrei Belousov told reporters after a cabinet
meeting in Moscow.
Sechin, who on Thursday was 9,000 km (5,600 miles) further
east, has lobbied against the further privatisation of Rosneft
after Britain's BP raised its stake in the Russian firm
to nearly 20 percent as part of last month's TNK-BP deal.
Shares in Rosneft fell on the news, shedding 1.3 percent on
the session, to touch their lowest level since Rosneft's
acquisition of TNK-BP - Russia's largest-ever takeover deal -
was announced in October.
(Additional reporting by Darya Korsunskaya; writing by Vladimir
Soldatkin; editing by Douglas Busvine and James Jukwey)