The Sakhalin region’s governor, Valery Limarenko, told the president that the region faced a forced step back because tax breaks tied to the halted Sakhalin-1 project vanished, wiping out a sizeable fiscal cushion. The issue, he explained, centers on the suspension of Sakhalin-1 and its ripple effect on regional finances. This account comes from DEA News and frames a moment of considerable financial pressure for the region.
In 2022, Limarenko noted, the region’s gross regional product dipped to 83 percent of its 2021 level, a contraction he linked directly to the operational pause at Sakhalin-1. He contrasted this with the Sakhalin-2 project, which, despite shifts in corporate participation, managed to rebound quickly under a new framework and even surpassed its production targets by about 15 percent. The comparison underscores how different oil and gas initiatives in Sakhalin respond to policy and market changes, as well as the region’s reliance on energy exports for growth.
Limarenko detailed the timeline of disruption at Sakhalin-1: oil production nearly halted in May, followed by a stop to gas production in September. The cumulative effect, he said, was a significant shortfall against the annual plan—more than half of the expected output. Given that two-thirds of the regional budget is derived from oil and gas taxes, his assessment projected a potential revenue loss approaching 50 billion rubles, with 49 billion rubles being an explicit figure. He expressed confidence that the region would weather the gap, but acknowledged the problem was serious and ongoing.
The discussion also touched on broader energy supply dynamics. A separate statement attributed to former Japanese Cabinet Secretary Hirokazu Matsuno pointed out a sharp decline in Russian oil imports by the second half of 2022, noting a decrease of roughly 90 percent. This observation is cited as part of the wider context of shifting trade patterns and energy flows that helped shape the economic environment for Sakhalin and similar regions during that period.