No one would actually accuse Russia of backtracking, but last week its minister of natural resources said his country had no intention of removing an operating license from Royal Dutch Shell PLC for the Sakhalin-2 development project.
To be sure, Yuri Trutnev said his ministry would conduct a fresh investigation of Shell’s compliance with environmental regulations. But he played down concerns that the undertaking would halt the project.
“There is no question of removing the license because of the result of the investigation,” Trutnev said. “The inspection should only examine whether the operator is abiding by environmental protection legislation, not the other aspects of resource use in Sakhalin region or offshore.”
Quick U-turn
That’s a far cry from earlier statements from the ministry which-several weeks ago-had threatened to cancel the environmental license for the Shell-led project (see related story, p. 25). That would certainly have created delays if it did not disrupt the development altogether.The threat attracted a strong backlash from politicians around the world, and that backlash in turn doubtlessly contributed to Moscow’s softened tone. Among the loudest voices of complaint were those of the normally quiescent Japanese. “Russia’s recent move to revoke environmental approval for a mammoth international project to develop oil and natural gas deposits on Sakhalin Island has put the country’s credibility as an energy supplier at risk,” intoned an editorial in Japan’s Nihon Keizai Shimbun. “Russia should realize that attempts to politically manipulate international energy projects could backfire by causing serious harm to the world’s trust in the country as a reliable supplier of energy,” the paper said.
Politicians object
Japanese politicians made themselves heard, too. Japanese Chief Cabinet Secretary Shinzo Abe even said that Russia’s decision to revoke its approval of the development project might have an adverse effect on overall Japan-Russian relations.
Shell did not sit on its hands, either. A senior British Shell source last week acknowledged that his company had gone to the highest level in the British and Dutch governments to get support for its claims. And those efforts paid off. Russian President Vladimir Putin quickly assured Dutch Prime Minister Jan Peter Balkenende that “constructive negotiations” would be held with Shell. Balkenende phoned Putin, who told him: “The Russian authorities will continue to engage with the companies concerned in a constructive way.”
Still, it seems to take a while for such messages to circulate. Hardly had the Shell flap begun to die down than the prosecutor general’s office summoned Valery Pak, the boss of Rusia Petroleum, TNK-BP’s 63%-owned operating company at the Kovytka gas field in Siberia.
It said: “Pak was warned that if the breaches of legislation are not remedied in a stated time, the prosecutor’s office will apply to the federal subsoil-use agency for a cessation of Rusia Petroleum’s right to exploit the Kovytka deposit.”
