Eric Watkins
Senior Correspondent
LOS ANGELES, Sept. 7 -- Sakhalin Energy Investment Co., the international consortium promoting crude oil and natural gas development off Russia's Sakhalin Island, Sept. 6 denied a claim by the Russian environmental regulator that the exploration program could harm the environment.
SEIC's denial followed a lawsuit filed in Moscow by the Federal Service for the Supervision of Natural Resources (FSSNR) which aims to have the government withdraw its approval of the Sakhalin-2 project on the grounds of possible environmental damage.
SEIC said it had cleared almost all environment-related recommendations made by experts when the Natural Resources Ministry approved the project.
Observers say the lawsuit is in line with the Russian government's call for SEIC to accept greater participation by state-owned gas monopoly OAO Gazprom, as no Russian concerns are involved in the project.
"We don't know anything about Gazprom planning to increase its stake to more than 25%,"said Russia's Deputy Economic Development and Trade Minister Kirill Androsov, denying that claim. Gazprom has been in talks with Shell for about a year on receiving 25% of Sakhalin-2 in exchange for some gas producing assets in Western Siberia.
The FSSNR suit is said to be motivated by Russia's desire to expand its interest in the Sakhalin project by pressuring the firms involved. The current shareholders are Shell Sakhalin Holdings BV, which has a 55% share in the project; Mitsui Sakhalin Holdings BV, which has a 25% share; and Diamond Gas Sakhalin, a Mitsubishi company, with a 20% share (OGJ Online Sept. 6, 2006).
Contact Eric Watkins at [email protected].
