YUZHNO-SAKHALINSK, Russia, Sept 24 (Reuters) - Gazprom has stopped talks over buying gas from the ExxonMobil-led Sakhalin-1 project after years of fruitlessattempts to secure a deal, Gazprom's Deputy Chief ExecutiveAlexander Medvedev told Reuters.
The talks had dragged on for years, with industry sourcessaying that Gazprom was offering a low price for the gas fromthe project on Russia's Pacific island of Sakhalin.
Earlier this year, Exxon and Rosneft, Russia's topoil producer, agreed to carry out a $15 billion project toliquefy natural gas in Russia's Far East.
"We are not in discussions; they will liquefy gas bythemselves," Medvedev told the Reuters Russia Investment Summiton Tuesday.
Exxon and Gazprom have also been in separate talks withChina for years to supply gas from different projects.
Exxon signed a preliminary agreement to sell gas to China in2006 and planned to supply this via pipeline. However, Gazpromasked the Russian government to block Exxon from sellingSakhalin gas to Asia, saying the output was needed for Russia'sFar East domestic market.
Gazprom previously said it wanted to buy all the gas fromSakhalin-1.
Medvedev also said on Tuesday that Gazprom might use anAsian oil products basket as a benchmark for pricing gas that itsupplies to China, signaling a desire to be more flexible intalks with Beijing.
Earlier on Tuesday, he told reporters that Gazprom did notexpect to use the Japanese Crude Cocktail, which is seen as anexpensive mix, as the benchmark for China.
Gazprom has been for years engaged in talks on selling gasto China. Last month it signed basic terms of an agreement withan aim to sing the final deal by the end of the year.
But reaching agreement on pricing has been the majorobstacle to a deal. (Reporting by Denis Pinchuk; writing by Vladimir Soldatkin;editing by Jane Baird)