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Daily Telegraph: Russia woos Japanese over Sakhalin project

By Roland Gribben
(Filed: 21/09/2006)

Russia is making renewed attempts to win Japanese support for Russian investment in the $20bn (£10.6bn) Shell-led Sakhalin oil and gas project offshore Siberia to ease diplomatic tensions.

Alexander Losyukov, Russia’s ambassador to Japan, said in Tokyo the project would advance faster if Gazprom, the state-controlled gas business, had a stake in the consortium, which currently has Shell (55pc) and two Japanese corporations, Mitsui and Mitsubishi (45pc combined) as partners.

Russia’s decision to revoke environmental permits has unnerved western investors and produced protests from the EU and Japan plus Britain’s ambassador in Tokyo. Shinzo Abe, Japan’s prime minister elect, has warned that a major delay could damage diplomatic relations. Mr Losyukov said that if Gazprom became a partner the project might be able to start earlier, an argument disputed by the current partners. He said that Russia did not intend to halt the development but the environment could not be sacrificed.

Shell has rejected claims that it had violated the terms of the environmental agreement which involves protecting feeding grounds of gray whales and breeding grounds.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/09/21/cnrussia21.xml

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