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AFX News Limited: Sakhalin-2 development cost estimate hiked, business model may change – minister

10.20.2006, 04:58 AM 
MOSCOW (AFX) – Sakhalin Energy, the operator of the Sakhalin-2 hydrocarbons development, has raised its estimate of the cost of the project to 21.9 bln usd from 9.9 bln, Interfax news agency quoted Deputy Industry and Energy Minister Andrei Dementyev as saying.

The ministry is now in talks with Sakhalin’s investors regarding the possibility of reviewing the project’s business model, he added.

Royal Dutch Shell PLC-led consortium holds a 55 pct stake in the project, whose permits Russia’s ministry of natural resources revoked last month on environmental grounds.

The Anglo-Dutch oil giant subsequently said it had ‘fully addressed’ those concerns.

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