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Bloomberg: Shell Will Get Chance to Fix Environment Damage, Russia Says

By Torrey Clark

Oct. 20 (Bloomberg) — Royal Dutch Shell Plc’s $22 billion Sakhalin-2 oil and gas venture will get the chance to repair environmental damages on the island, Russian Natural Resources Minister said, as the government softens a campaign to increase its sway over the development.

Russia has no plans to stop Sakhalin-2, Yury Trutnev told the upper house of Russia’s parliament at hearings on the development today in Moscow. The government expects to levy fines against the project and will make a final decision at the end of the month when it completes a review of Sakhalin-2.

The ministry’s environmental campaign against Shell raised concerns that President Vladimir Putin is using the inspections to aid state-run OAO Gazprom’s attempt to get a piece of the project. Sakhalin contains the equivalent of 45 billion barrels of oil, equal to the North Sea’s reserves, Shell estimates.

Sakhalin Energy Investment today said it had invited Rosprirodnadzor, the Natural Resources Ministry’s environmental inspectorate, to review work carried out at the Makarov region, where inspectors uncovered environmental problems in August. Sakhalin Energy wrote to Trutnev on the matter.

“The company will respond quickly and adequately to correct any more non-conformances that may be identified by the further Rosprirodnadzor inspection that started Oct. 3,” the company said today in an e-mailed statement, citing Sakhalin Energy Chief Executive Officer Ian Craig. The company is “further strengthening controls and oversight of contractors and subcontractors executing the pipeline construction.”

To contact the reporter on this story: Torrey Clark in Moscow at [email protected] . and its sister non-profit websites,,,,,, and are owned by John Donovan. There is also a Wikipedia feature.

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