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RIA Novosti: Upper chamber to consider situation around Sakhalin II

14:32 | 26/ 09/ 2006 

MOSCOW, September 26 (RIA Novosti) – Russia’s upper chamber of parliament ordered its committees Tuesday to examine the situation around the massive Sakhalin II energy project, off the country’s Pacific coast.

Environmentalists have consistently raised concerns over Sakhalin II, and the Ministry of Natural Resources annulled its approval of a 2003 environmental study of the project last Monday after prosecutors protested the original endorsement.

The move puts in jeopardy contracts with Japan, South Korea and the United States on deliveries of LNG, due to go into effect in 2008.

Federation Council Speaker Sergei Mironov said the situation is “scandalous” and ordered the council’s committees for natural resources and economic policy to examine it.

“This project is very important to Russia, but there are a number of juridical and ecological aspects, as well as the need to protect foreign investors,” he said.

Mironov said the senators are dissatisfied with the obscure and contradictory explanations given by some ministry officials, and want to know what is really going on. He said both the environmental and investment aspects of the project are important.

“No one should think that it is dangerous to invest in [Russian] economy, and that we make unpredictable decisions,” Mironov said.

According to the World Wildlife Fund Russia, dead crabs and fish appeared September 21-22 on a 10 kilometer (6 miles) strip along the coast of the Sea of Okhotsk, where Royal Dutch Shell-led Sakhalin Energy is building facilities for Sakhalin II.

Natural Resources Minister Yury Trutnev said after a meeting with Sergei Sai, head of the Federal Service for the Oversight of Natural Resources, that the second stage of the project will only be checked for compliance with environmental laws, and that the inspection will not involve economic issues.

“The issue of license revocation is not under consideration,” the minister said.

The federal agency said the inspection, to be held from September 25 until October 20, will cover forest reserves, water facilities adjacent with a pipeline, and the construction of a terminal in Aniva Bay.

Particular attention will be paid to recommendations in the state environmental study of the Piltun-Astokhsky and Lunsky license areas, it said.

The $20-billion Sakhalin II project comprises an oil field with associated gas, a natural gas field with associated condensate production, a pipeline, a liquefied natural gas plant and an LNG export terminal. The two fields hold reserves totaling 150 million metric tons of oil and 500 billion cubic meters of natural gas.

Sakhalin Energy comprises Shell Sakhalin Holding (55%), Mitsui Sakhalin Development (25%) and Mitsubishi-controlled Diamond Gas Sakhalin (20%).

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