MOSCOW, July 7 (Xinhuanet) -- Russia's gas monopoly Gazprom on Thursday signed a memorandum of understanding on share swapping with Anglo-Dutch group Shell to pave the way for Gazprom to join the Sakhalin-2 project designed to ship liquefied natural gas (LNG)from Russia's Far East to North America and the Asia-Pacific region.

    Under the memorandum, signed in London, Gazprom will buy 25 percent plus one share in the Sakhalin-2 project while Shell will acquire a 50 percent stake in the Zapolyarnoye Neocomian oil field in Siberia, the Interfax news agency reported, quoting a Shell press release.

    The difference in value is to be compensated through cash or other assets, and the two companies are expected to finalize the transaction in 2006, the release said.

    The Sakhalin-2 project has reserves of some 150 million tons of oil and 500 billion cubic meters of gas.

    Gazprom chief Alexei Miller said after the signing ceremony that his company seeks to enter the LNG sector and the memorandum "opens the way for Gazprom to become, in the nearest future, a large shareholder of a fast growing project for hydrocarbons development, LNG production and sales to strategic markets in North America and Asia-Pacific Region."

    Shell Chief Executive Jeroen van der Veer called Gazprom a "great Russian partner in the Sakhalin-2 project."

    "Joint development of the Zapolyarnoye-Neocomian field will build on our position in western Siberia," the press release quoted the Shell chief as saying.

    The memorandum "strengthens the good relationship between Shelland Gazprom and is a basis for further cooperation on integrated gas projects both in Russia and internationally," he said. Enditem