December 26th, 2006:

Associated Press
By KATHARINE HOURELD 12.26.06, 2:43 PM ET
 
A gasoline pipeline ruptured by thieves exploded into a blazing inferno Tuesday as scavengers collected the fuel in a poor neighborhood, killing at least 260 people in the latest oil-industry disaster to strike Africa’s biggest petroleum producer.

Braving a towering pillar of fire and a cloud of acrid black smoke, thousands of people in Lagos’ Abule Egba neighborhood surged around rescue workers carrying away charred bodies, hoping to catch a glimpse of missing relatives. read more

20:16 | 26/ 12/ 2006 

MOSCOW. (RIA Novosti political commentator Alexander Yurov) – The urgent visit to Moscow of top executives from companies that are participating in the Sakhalin II project and their meeting with Russian President Vladimir Putin ended with mutual satisfaction.

Royal Dutch/Shell, Mitsui and Mitsubishi agreed to let the Russian gas giant Gazprom joint the project. The sum they are to receive for it is unexpectedly big, $7.45 billion.

Of course, the agreement did not come easy, which is hardly surprising given that at stake was control over 150 million tons of oil and 500 billion cu m of gas – that much is held by offshore reserves developed by international consortium Sakhalin Energy, the project’s operator. read more

Passage into state hands has been seen as another successful Kremlin effort to reestablish control over Russia’s energy production   
 
Tuesday, December 26, 2006
by RFE/RL   

Anglo-Dutch giant Shell and two Japanese companies have announced they will cede their majority stake in the Sakhalin-2 energy project to Russia’s state-controlled natural gas monopoly, Gazprom, for $7.45 billion. Sakhalin-2 is the largest combined oil and natural-gas development in the world. Its passage into state hands has been seen as another successful Kremlin effort to reestablish control over Russia’s energy production. read more

Richard Weitz | 26 Dec 2006
World Politics Watch Exclusive

On Dec. 22, the Russian government succeeded in its long-standing campaign to wrest control of the country’s largest single foreign investment project — the $22 billion natural gas development on the Russian Pacific island of Sakhalin. The project includes the first liquefied natural gas (LNG) plant and related export facilities built in Russia.

According to the deal, Royal Dutch Shell, Mitsui & Co., Ltd., and Mitsubishi Corp. will each surrender half of their shares in the Sakhalin Energy consortium. In their place, OAO Gazprom, Russia’s state-controlled natural gas monopoly, has taken a majority (50 percent plus one share) stake in the project, paying a discounted price of $7.45 billion, as much as 20 percent below market estimates of the surrendered assets’ true worth. read more

Chevron and other oil companies have to postpone projects because of the lack of such vessels.

Joe Carroll | Bloomberg News
Posted December 26, 2006 

Bill Thornburg, a senior drill-site manager for Chevron Corp., opens a steel door on a floating oil rig off the Louisiana coast and stops dead in his tracks.

Red plastic tape warns that crews are hauling pipe and wrenches the size of baseball bats across a deck slick with sea spray. If it were up to Thornburg, there would be a dozen more $1 million-a-day rigs plying the Gulf of Mexico. read more

Reuters

MOSCOW — TNK-BP must accommodate Gazprom into its giant Kovykta gas project or face new sanctions for licensing noncompliance, an official said Thursday.

TNK-BP is the main shareholder in Rusia Petroleum, which has the license to operate Kovykta. Under the licensing agreement, the firm should produce 9 billion cubic meters of gas next year.

TNK-BP wants to export gas from Kovykta, in Siberia, to China. But its plans have stalled because Gazprom has refused to let the $10 billion project build a pipeline to the border and restricts it to supplying a local market that needs no more than 2.5 bcm. read more

11:50 | 26/ 12/ 2006 

MOSCOW. (RIA Novosti economic commentator Nina Kulikova) – This year has been the most eventful for Russia’s energy policies since the break-up of the Soviet Union. Moscow has convinced everyone that the many years of subsidized gas prices for neighboring economies are becoming a thing of the past and that it is firmly determined to defend the position of its energy industry on the international stage.

When Gazprom first announced its plans to go over to market prices for all its partners, including in the CIS, few could believe it possible or imagine the outcome. Yet the first days of January 2006 showed that Gazprom was determined to deal with the gas transit problem in a decisive way. Throughout 2005, Ukraine had ignored the gas monopoly’s proposals to discuss gas prices and their rise. When 2006 came, and there was still no agreement in place, gas supply to Ukraine was suspended. Then Kiev began siphoning off Russian gas transported via its territory to the EU, which caused a shortage of gas and a subsequent outrage in West Europe. read more

By ROBERT AMSTERDAM
December 26, 2006
 
In the latest news coming out of Russia, Mikhail Khodorkovsky has been transferred within Siberia from a gulag to a pre-trial detention center in Chita for what may be the application of further bogus charges against him. And on Friday, police officials took his father, recently released from hospital, for interrogation.

Although you may not have remarked upon it, even before this news, the name of my client had taken on new significance. For his is one of a handful of names to appear recently in two otherwise seemingly unrelated stories out of Russia: the mysterious poisoning of the former Russian spy, Alexander Litvinenko, and the decision by Royal Dutch Shell to give in to Kremlin pressure and offer up a large stake in the Sakhalin-2 natural gas project. read more

Last Updated: 12:01am GMT 26/12/2006

Nearly seven years ago, on the eve of his becoming interim president of Russia, Vladimir Putin published his Millennium Manifesto. Following the collapse of communism and the chaos of the Yeltsin years, this was a blueprint for restoring Russian greatness which traced a “third way” between discredited Bolshevism and Western liberal democracy. The key was the restoration of the power of the state, whose monopoly of violence had been challenged in the 1990s by a combination of mafiosi, politically ambitious oligarchs, media barons and regional governors. read more

Issue #1233(99), Tuesday, December 26, 2006
By Sebastian Smith
AGENCE FRANCE PRESS/Bloomberg

MOSCOW — Moscow has savoured victory after state giant Gazprom ousted Royal Dutch Shell from control of the Sakhalin-2 energy project, ending a struggle highlighting changing rules in Russia’s bare-knuckle business environment.

The announcement late on Thursday that Gazprom would take the controlling stake in the $22 billion natural gas development was a milestone in President Vladimir Putin’s campaign to restore state control over the energy industry. read more