December, 2006:

By Stephen Voss

Dec. 15 (Bloomberg) — Graveney was the site of the last combat on English soil when British forces battled a downed German bomber crew in 1940. Now the village is fighting a new enemy: the world’s biggest wind farm.

The local council, acting on behalf of the town’s 473 residents, refused to permit a substation for the $1.5 billion London Array, which would put 271 wind turbines in the estuary of the River Thames. Royal Dutch Shell Plc and E.ON AG plan to bring power cables ashore near Graveney. read more

Created: 15.12.2006 12:22 MSK (GMT +3), Updated: 12:22 MSK

Shares in Peter Hambro Mining bounced back by more than 12 percent in late Thursday trading, after Russian government officials indicated that the gold producer’s main mining licenses were not under threat.

The stock has fallen sharply over the last two weeks after Oleg Mitvol, deputy head of Russia’s environmental watchdog Rosprirodnadzor, said five of the company’s gold mining licenses should be revoked because of environmental violations. Rosprirodnadzor is currently inspecting all of PHM’s Russian gold mining projects. read more

Fri Dec 15, 2006 11:03am ET
 
MOSCOW, Dec 15 (Reuters) – The supervisory board of the Shell-led (RDSa.L: Quote, Profile , Research) Sakhalin-2 venture has approved the project’s 2007 budget of $1.17 billion — the Russian Energy Ministry said in a statement on Friday.

The supervisory board, which oversees the production sharing agreement which governs Sakhalin-2, also considered other issues including the overall budget for the project’s second phase, it said.

Shell and its Japanese partners Mitsui (8031.T: Quote, NEWS , Research) and Mitsubishi (8058.T: Quote, NEWS , Research) have infuriated Russian officials by boosting the second phase budget from $10 billion to $20 billion, in addition to the $2 billion first stage. read more

12.15.06, 8:14 AM ET
 
BRUSSELS (AFX) – The EU is worried about the difficulties faced by Royal Dutch Shell PLC over its Sakhalin-2 project in Russia, European Commission president Jose Manuel Barroso said following a two-day summit here.

Barroso told reporters that Dutch prime minister Jan Peter Balkenende raised the issue with him during the summit.

‘So it’s a matter of concern for us what’s happening now in Sakhalin,’ he said.

Barroso said he and Finnish prime minister Matti Vanhanen, whose country holds the rotating EU presidency, also expressed their concern during their talks with Russian president Vladimir Putin in Helsinki last month. read more

Update: 7:14 AM ET Dec 15, 2006

YENAGOA, Nigeria (AP) — Royal Dutch Shell PLC (RDSB) officials said Friday the company has shut down an occupied Nigerian oil facility, a move that will cut production by 12,000 barrels a day.

Earlier, armed men took control of the compound, and Shell officials said a nearby flowstation – a facility where oil pipelines converge – was shut as a precaution.

Joshua Benemesia, a local chief who has mediated hostage negotiations in Nigeria’s oil-rich delta region, said at least one man was shot in the attack. There were no immediate reports of deaths. read more

15:49 | 15/ 12/ 2006

MOSCOW. (RIA Novosti economic commentator Vasily Zubkov) – Easy come, easy go – this is perhaps the best description of what is happening to oil and gas giant Shell on the Russian island of Sakhalin.

The Russian environmental authorities are accusing the Anglo-Dutch company of violating their regulations. Foreign observers believe this is just an excuse to push Shell out of the key position in the Sakhalin oil project.

When Shell received the right to develop Sakhalin fields under a product-sharing agreement 12 years ago, the West welcomed the deal. read more

Fri Dec 15, 2006 6:40 AM ET
(Adds sources on “road map”, outlook for talks)
By Tom Miles and Douglas Busvine

MOSCOW, Dec 15 (Reuters) – Royal Dutch Shell CEO Jeroen van der Veer met Gazprom chief Alexei Miller on Friday in Moscow to discuss admitting the Russian gas monopoly to the Sakhalin-2 project, Gazprom said.

The heads of Shell’s two Japanese partners in the project — Mitsui’s <8031.T> Shoei Utsuda and Mitsubishi’s <8058.T> Yorihiko Kojima — were also in Moscow for talks, spokesmen for both companies said in Tokyo. read more

By: John Helmer
Posted: ’15-DEC-06 09:00′ GMT © Mineweb 1997-2006

MOSCOW (Mineweb.com) –There are three opponents of Russia’s strategy to become a global liquefied natural gas (LNG) exporter — the Western Gray Whale, the US Government, and Gazprom.

Until this week, and for quite different reasons, all three, including the LNG producer itself, Gazprom, — Russia’s energy champion, the world’s biggest energy exporter — have succeeded in delaying and redirecting plans to start shipments from the first of Russia’s LNG plants at Aniva Bay on Sakhalin Island, in the Fareast; and to postpone indefinitely drawing-board plans and joint venture agreements to build the second and third LNG plants on the Baltic, and to the north, on the Barents Sea. read more

Last Update: 6:59 AM ET Dec 15, 2006

MOSCOW (MarketWatch) — The chief executives of OAO Gazprom (GSPBEX.RS) and Royal Dutch Shell PLC (RDSB) met Friday in Moscow to discuss the Sakhalin-2 oil and gas project on Russia’s Pacific coast, the Russian gas monopoly said in a statement.

Gazprom said its CEO Alexei Miller and Shell CEO Jeroen van der Veer discussed Shell’s offer for Gazprom’s participation in the development, although it didn’t give any further details.

Both Gazprom and Shell declined to give any details of the meeting. read more

By WILLIAM NSOYOH Associated Press Writer
© 2006 The Associated Press
Dec. 15, 2006, 6:16AM

YENAGOA, Nigeria — Armed men who seized control of a Royal Dutch Shell PLC oil complex overnight fled Friday, taking three Nigerian hostages, shooting a man and forcing the oil giant to halt production at the site.

The attackers kidnapped a soldier, an administrative officer and a chef who works at a base that houses staff and stores equipment in Oporoma in the southern state of Bayelsa, said Joshua Benemesia, a traditional chief who has mediated hostage negotiations in the oil-rich delta region. read more

By EDMUND L. ANDREWS
Published: December 15, 2006

WASHINGTON, Dec. 14 — The Justice Department has begun two criminal investigations into the Interior Department’s Minerals Management Service, which is already the focus of several inquiries into its collection of royalties for oil and gas produced on federal property.

The new investigations are still in the early stages, said Congressional officials who were briefed this week by Earl E. Devaney, the Interior Department’s chief independent investigator. read more

· Russians hire British legal firm for Sakhalin case
· Kremlin ‘attack dog’ faces disciplinary action

Terry Macalister
Friday December 15, 2006

The British lawyer who represented Greenpeace in the battle with Shell over the disposal of the Brent Spar oil platform has been hired by Russia to prepare a case against the Anglo-Dutch oil company over problems at its development project on Sakhalin island off Siberia.

Mark Stephens, partner at Finer Stephens Innocent, said he expected court proceedings in spring although he would not say whether that would be in London, New York or Moscow. read more

By Russell Hotten
Last Updated: 12:32am GMT 15/12/2006

The natural resources minister in Russia has rejected a call to reprimand outspoken environmental regulator Oleg Mitvol, who has led a campaign against Royal Dutch Shell and other Western energy companies.

Sergei Sai, the head of state environment watchdog Rosprirodnadzor, had asked natural resources minister Yuri Trutnev, who oversees his agency, to review Mitvol’s work, citing “inefficiencies”. Trutnev rejected the appeal.

Rinat Gizatulin, spokesman for Mr Trutnev, said: “He said the effectiveness of Mitvol is higher than that of the Rosprirodnadzor leadership and advised Sai to do something about it.” read more

Fri Dec 15, 2006 2:02am ET

ABUJA, Dec 15 (Reuters) – Gunmen have invaded a Shell-operated oil facility in the Nun River area of Nigeria’s Bayelsa state and are holding several soldiers and oil workers hostage, security and industry sources said on Friday.

It was the second attack against the oil industry in Bayelsa in eight days, after militants tried to destroy a major oil export terminal and kidnapped four foreign oil workers last Thursday.

© Reuters 2006. All Rights Reserved.

The Associated Press
Published: 2006-12-15 01:30:13

YENAGOA, Nigeria: Armed men attacked a southern Nigerian oil installation owned by a subsidiary of Royal Dutch Shell PLC overnight, a local leader said Friday.

Joshua Benemesia, a local chief who has mediated hostage negotiations in the oil-rich delta region, said at least one man was shot in the attack.

There were no immediate reports of deaths or hostage-takings, he said. Benemesia did not provide details on how many attackers were involved or what type of oil facility was targeted. read more

25 December 2006

Four-fifths of the way toward completion of the $20 billion Sakhalin 2 oil and gas megaproject on an island off eastern Russia, Royal Dutch Shell (RD ) has offered to give up control to energy giant Gazprom, reported Reuters on Dec. 11.

Moscow has been nagging Shell about cost overruns and environmental disputes. Shell says nothing has been agreed on, but it’s clear Gazprom will end up with a big share. Compensation could come in cash and a share of Gazprom gas reserves in Siberia. read more

The last thing we need is another failed nation-state. Getting Russia into the World Trade Organization may be the best chance to keep its profoundly troubled economy from Armageddon.

By Jim Jubak

The death by polonium poisoning of an outspoken critic of the regime. The assassination of the corruption-fighting deputy chairman of the central bank. The culmination of a blackmail campaign that forces a Western oil company to turn over control of a Siberian energy field to the Kremlin’s candidate. read more

December 14, 2006] 

Evening Standard, London, Neil Collins column

One of the rules of engineering states that things don’t fail catastrophically without warning. There’s almost always an indication of trouble ahead some time before the event. As the gruesome facts of the disaster that overtook BP’s Texas City refinery leak out like a toxic spill, it’s clear that plenty of warning signs had been ignored before the plant blew up, killing 15 people.

The harbinger of trouble can take many different forms, but here’s a strange one: a long analysis of the benefits of merging BP with Royal Dutch Shell, put together by David Cline of ABN Amro. Over 116 pages, he grinds through aspects of such an unlikely event — from synergies to regulation and divestment — concluding that none of the multitude of problems is insurmountable, and that Shell (rather than BP) is an absurdly cheap stock. read more

Crude-oil futures rose more than $1 a barrel to close at $62.51 after OPEC announced plans to cut production in February. Here is Thursday’s roundup of oil and energy news:

* * *
OPEC AGREES TO CUT: In a strong signal it will try to prevent oil prices from sliding further, OPEC said it plans to slice its output by an additional 1.9% starting Feb. 1. The cartel also accepted Angola, whose oil output is climbing sharply, as its 12th member — the first new entrant since 1973. The West African country will join March 1, the Qatari oil minister told The Wall Street Journal. The real impact of the cartel’s latest output move on oil markets remains unclear. The big unknown is whether OPEC members will actually implement the decision, which calls for a cut of 500,000 barrels a day. read more

Dec 14, 2006 12:18:00 PM MST
 
MOSCOW (AP) _ Russia‘s natural resources minister has rejected a call to reprimand outspoken environmental regulator Oleg Mitvol, who has led a controversial environmental probe against a major Shell-led liquefied gas project, a spokesman said Thursday.

Sergei Sai, the head of state environment watchdog Rosprirodnadzor, had asked Natural Resources Minister Yuri Trutnev, who oversees his agency, to review Mitvol‘s work, citing “inefficiencies.‘‘

Trutnev flatly rejected the appeal. read more

By Jim Efstathiou Jr.

Dec. 14 (Bloomberg) — Royal Dutch Shell Plc, BP Plc, ConocoPhillips and Marathon Oil Corp. reached agreement with the U.S. Minerals Management Service to pay oil and gas royalties under botched Gulf of Mexico leases from 1998 and 1999.

The companies are among a group of about 50 oil and gas producers holding leases that omitted price triggers needed to ensure payment of royalties when energy prices rise. Congress narrowly defeated a measure last week that would have forced the companies to renegotiate the contracts. read more

Terry Macalister
Thursday December 14, 2006

The British lawyer who represented Greenpeace in the battle with Shell over the disposal of the Brent Spar oil platform has been hired by Russia to prepare a case against the Anglo-Dutch oil company over problems at its development project on Sakhalin island off Siberia.

Mark Stephens, partner at Finer Stephens Innocent, said he expected court proceedings in the spring, although he would not say whether that would be in London, New York or Moscow.

In another twist to the Sakhalin story today, there was news that the environmental official dubbed a “Kremlin attack dog” for his verbal assaults on Shell’s environmental records faces disciplinary proceedings.
Oleg Mitvol, the deputy head of RosPrirodNadzor, Russia’s environmental agency, has been recommended for a formal warning by his own boss in a move which was variously interpreted as the result of internal jealousy or a softening of the Kremlin’s line as a deal neared between Shell and state-owned Gazprom over an asset swap. read more

Oleg Mitvol

Sergey Say, who is the chief of Russia’s Federal Service for Natural Resources Supervision (Rosprirodnadzor), has set into motion the ousting procedures for his deputy, Oleg Mitvol, RIA Novosti reported referring to a source with Rosprirodnadzor.

Sergey Say addressed Natural Resources Minister Yury Trutnev, urging him to arrange the office probe into Mitvol “with subsequent disciplinary punishment and ouster,” the source specified on condition of anonymity. The ministry’s news service confirmed the receipt of the letter. read more

Posted on : Thu, 14 Dec 2006 16:09:00 GMT | Author : Amsterdam & Peroff
News Category : PressRelease  

LONDON, Dec. 14 /PRNewswire/ — Following news of the dismissal of Russia’s chief environmental inspector, Oleg Mitvol, just two days after Shell’s offer to give up a majority stake in the Sakhalin-2 project to the Russian government, Attorney Robert Amsterdam issued the following statement:

“This decision on behalf of Royal Dutch Shell to give in to the extortion of the Russian government is a betrayal of not only their shareholders’ interests, but also an abandonment of those who fight for rule of law,” said Amsterdam. “The Kremlin’s theft of Sakhalin-2, carried out with Yukos-like tactics and veiled by fraudulent environmental claims, deserves a stout response from Western corporations, banks, governments – not the complicity and silence currently promoted by the Dutch.”
 
“The environmental concerns at Sakhalin are just one component of Russia’s established expropriation template, illustrated by the hypocrisy of the North European Gas Pipeline planned for the Baltic Sea, which poses the clearest environmental threat of all Russian energy projects. Not only has Shell given up the largest foreign investment project in Russia without a fight, they have contributed to Europe’s weakening energy security and emboldened the Kremlin’s impunity to rewrite contracts, ignore property rights, and harass and interfere with foreign investors of its choosing.” read more

Thu Dec 14, 2006 1:57 PM ET
(Updates with reprieve for Mitvol)
By Tom Miles

MOSCOW, Dec 14 (Reuters) – Russia’s resources minister on Thursday backed environment watchdog Oleg Mitvol, who has rocked the $22 billion Shell-led Sakhalin-2 energy scheme, even after the official’s own boss demanded he be brought to heel.

News that Sergei Sai, head of the environmental agency RosPrirodNadzor, had asked Resources Minister Yuri Trutnev to formally warn Mitvol came amid signs Royal Dutch Shell is nearing a deal to cede control in Sakhalin-2 to state gas monopoly Gazprom . read more

The Associated Press
December 14, 2006, 10:32AM EST
MOSCOW

The head of Russia’s environmental watchdog has called for an official review of his outspoken deputy, Oleg Mitvol, who has led a controversial environmental probe against a giant Shell-led liquefied gas project, a spokesman said Thursday.

Mitvol has been the face of an environmental campaign against Royal Dutch Shell PLC’s $22 billion Sakhalin-2 project, which observers say is aimed at securing control for state gas monopoly OAO Gazprom. read more

By Tom Miles

MOSCOW, Dec 14 (Reuters) – Russia’s outspoken environment watchdog Oleg Mitvol, who has waged a campaign against the Royal Dutch Shell-led Sakhalin-2 energy project, faced a disciplinary rap on Thursday that could herald his dismissal.

News that Mitvol’s boss at the state environmental agency had asked Resources Minister Yuri Trutnev to give Mitvol a formal warning came amid signals Shell is nearing a deal to cede control in Sakhalin-2 to Gazprom .

“The document has been submitted to the ministry, but it hasn’t been reviewed by the minister himself,” Rinat Gizatullin, a spokesman for Trutnev, said. “We will examine it and respond at the start of next week.” read more

December 14,2006
The Freedom View

The Russian government has successfully pressured Shell, the Anglo-Dutch oil company, into reducing its stake in a promising but difficult oil and natural-gas field in Siberia from a majority share to a minority share. Gazprom, the Russian state-owned energy group, which has invested little or nothing in exploiting the energy resources on and around Sakhalin Island, will now have the majority interest. The interests of two minority Japanese investors, Mitsui and Mitsubishi, have also been reduced. read more

15:36 | 14/ 12/ 2006 

MOSCOW, December 14 (RIA Novosti) – The head of Russia’s environment watchdog has proposed firing his deputy, who led a recent crackdown on a vast Shell-run hydrocarbon project in Russia, a source in the federal service said Thursday.

Oleg Mitvol has overseen inspections of a series of leading Russian and foreign mining and hydrocarbon companies, and is known for radical moves such as ordering the demolition of cottages in a water-protection zone near Moscow.

“Sergei Sai wrote a letter to Natural Resources Minister Yury Trutnev yesterday, requesting an official probe into Mitvol’s activities, a reprimand, and his dismissal,” a source said. read more

December 15, 2006

By John Helmer

MOSCOW- There are three opponents of Russia’s strategy to become a global liquefied natural gas (LNG) exporter – the western gray whale, the US government and Gazprom.

Until this week, and for quite different reasons, all three, including the LNG producer itself, Gazprom, have succeeded in delaying and redirecting plans to start shipments from the first of Russia’s LNG plants at Aniva Bay on Sakhalin Island, in the Far East; and to postpone indefinitely drawing-board plans and joint-venture agreements to build the second and third LNG plants on the Baltic, and to the north, on the Barents Sea. read more

Thu Dec 14, 2006 6:35am ET

MOSCOW, Dec 14 (Reuters) – Russia’s outspoken environment watchdog Oleg Mitvol, who has waged a harsh campaign against the Shell-led Sakhalin-2 energy project, faced disciplinary proceedings on Thursday that could herald his dismissal.

The head of state environmental agency RosPrirodNadzor, Sergei Sai, has asked Resources Minister Yuri Trutnev to hand Mitvol a formal warning, a ministry spokesman said.

“The document has been submitted to the ministry, but it hasn’t been reviewed by the minister himself,” said ministry spokesman Rinat Gizatullin. “We will examine it and respond at the start of next week.” read more

MOSCOW, Dec 14 (Prime-Tass) — Sergei Sai, director of Russia’s Federal Service for Natural Resources Oversight, wants his deputy, Oleg Mitvol, to be fired, a source at the service said Thursday, ITAR-TASS reported.

Sai sent a letter requesting Mitvol’s dismissal to Natural Resources Minister Yury Trutnev on Wednesday. The Federal Service for Natural Resources Oversight reports to the Natural Resources Ministry.

However, on Thursday the Natural Resources Ministry denied that Sai had asked the minister to fire Mitvol. Sai only wanted to have Mitvol formally rebuked, said Rinat Gizatulin, spokesman for the Natural Resources Ministry, according to Vesti.ru. read more

Thu Dec 14, 2006 4:53 AM ET
By Dmitry Zhdannikov

MOSCOW, Dec 14 (Reuters) – Royal Dutch Shell denied on Thursday that it had again increased costs of its Sakhalin-2 oil and gas project as such a move would further complicate talks on including Russia’s Gazprom in the project.

The previous costs revision to $22 billion from $12 billion at Sakhalin in 2005 infuriated the state gas monopoly, which was then prepared to buy 25 percent in the project, and prompted a flurry of investigations by Russian authorities. read more

EXTRACT: Before moving into politics Mr Mitvol ran a media business, and was majority shareholder in the Russian daily newspaper, Noviye Izvestia, once owned by exiled oligarch Boris Berezovsky. There have been reports that Mr Putin installed Mr Mitvol at the newspaper after the president fell out with Mr Berezovsky.

THE ARTICLE:

By Russell Hotten, Industry Editor
Last Updated: 1:07am GMT 14/12/2006

Oleg Mitvol, the Moscow official pursuing western oil and gas com-panies over alleged environmental violations, insisted he is not being directed by President Vladimir Putin and that his campaign will make Russia a better place for foreign investors.
  
Rusty green? The Molikpaq offshore oil platform, producing up to 70,000 barrels a day, off Sakhalin island
 
The millionaire businessman-turned-“green”-protector said environmental concerns were not “exclusive to western liberals” and that he would press on with legal action against Royal Dutch Shell for up to $30bn (£15bn) in damages. read more

EXTRACTS: On the one hand, the state-controlled company, increasingly seen as an instrument to project the Kremlin’s power, is hungry for assets, as the latest showdown with Shell over the Sakhalin-2 project demonstrates.

At the top the company appears indivisible from the state: Kremlin spokesmen explain its decisions; its chairman, Dmitry Medvedev, happens also to be a deputy prime minister.

THE ARTICLE

Mark Rice-Oxley in Novy Urengoi
Thursday December 14, 2006

In the frigid emptiness of northern Siberia, where the winter dusk descends soon after lunch and darkness lingers until after breakfast, there’s an old vodka toast that locals raise to take the edge off the Arctic chill: “Za nas, za vas i za gas” – to us, to you and to gas. read more

Published: Dec 14, 2006

THE Corrib Gas partners, who include Norwegian firm Statoil, US firm Marathon Petroleum and the project operator Shell, are moving ahead with the construction of onshore facilities at Bellanaboy in Co Mayo.

At the signing of a new deal by Shell were Pat Ahern, MD of SIAC Butlers Steel Ltd with Andy Pyle, MD of Shell E&P Ireland, Gerry Costello, Shell, Keith Elliott from PM Group, Roger Woodrow and Brian Foley from Shell.

By Neil Buckley and Arkady Ostrovsky in Moscow
Published: December 13 2006 22:07 | Last updated: December 13 2006 22:07

Russia is preparing to cut off natural gas supplies to neighbouring Belarus and Georgia unless the two former Soviet republics agree by the year-end to pay much higher prices in 2007.

Coming a year after Gazprom, the Russian gas giant, briefly cut gas to Ukraine in a similar pricing dispute, such a move could provoke further international criticism that Moscow is using energy as a political tool. read more

December 14, 2006: Carl Mortished, International Business Editor

Russia accused of bullying staff
Expatriates fear withdrawal of visas
 
The cost of Royal Dutch Shell’s Sakhalin-2 gas project is close to $25 billion (£12.7 billion), a rise of $5 billion from previous estimates, after a campaign of harassment by the Russian Government, The Times has learnt.

Progress on the project has been delayed by harassment that includes refusal of drilling permits and visas and the bullying of Shell staff. The soaring costs and delays come as Shell’s responsibility for Sakhalin is being reduced. 
 
The late start of drilling at Lunskoye, a huge offshore gasfield, threatens to delay vital deliveries of liquefied natural gas (LNG) to Shell’s Japanese and South Korean customers, due to start in September 2008. read more

(Vladimir Filonov / MT
Oleg Mitvol)

EXTRACT: Peter Hambro, Russia’s third-largest gold miner, has lost nearly $500 million in the last two weeks — almost one-quarter of its value — after the environment agency called for the withdrawal of licenses it said were affiliated to the company.
 
Peter Hambro said Tuesday that the talks are a “huge positive step.” Hambro is flying to Moscow to meet the outspoken deputy head of the environment inspectorate, Oleg Mitvol, who said Tuesday that checks were under way of all 54 licenses owned by Peter Hambro-affiliated companies in the country. read more

Thursday, December 14, 2006. Issue 3561. Page 5.
Reuters

Pressure from the authorities is beginning to threaten the timetable of the Shell-led Sakhalin-2 oil and gas project, the venture’s operator said Wednesday.

“The activity of the regulatory bodies who are slowing down the process of getting an agreement is beginning to have an effect on the project,” said Igor Ignatyev, vice president of the operator, Sakhalin Energy.

“In January we are due to start drilling at the Lunksoye field, but for more than two months, we haven’t been able to get the environmental inspectorate to send its agreement for the start of drilling. read more

Crude-oil futures rose to more than $61 a barrel on the New York Mercantile Exchange after the federal Energy Information Administration reported across-the-board draws in U.S. petroleum stocks, including a surprisingly large decline in crude inventories. Here is Wednesday’s roundup of oil and energy news:

* * *
OPEC MAY HOLD STEADY: OPEC may keep production steady, the organization’s president suggested, despite renewed calls by some oil ministers for new cuts to shore up prices. Until recently, OPEC President Edmund Daukoru had been a firm backer of cuts. But on Wednesday he said OPEC first had to “look at the facts” before making a decision. And Saudi Arabia has also indicated there was less sentiment to cut than just a few days ago. The International Energy Agency urged OPEC not to cut production. read more

By GREG WALTERS
December 13, 2006 1:06 p.m.

International energy consortium Sakhalin Energy said it will probably miss a January target to start drilling for natural gas at the Lunskoye gas field offshore Russia.

The delay comes because the Russian state environmental regulatory agency Rosprirodnadzor, which has criticized the company in recent months over its environmental record, hasn’t given its approval.

Sakhalin Energy spokesman Ivan Chernyakhovsky said the company has already installed an offshore drilling platform at the field but couldn’t begin drilling without express approval from Rosprirodnadzor. read more

INVESTOR’S BUSINESS DAILY

Energy: President Vladimir Putin insists he wants Russia to be a respected member of the community of nations. Why, then, does he keep doing things that remind us of the bad old days of the USSR?

Russia talks a good game about wanting more trade and investment with the West. But then it goes and does something crazy: seizing the assets of Shell Oil off Sakhalin Island.

Why did Putin decide to grab Shell’s $20 billion investment? The easy answer is, because he could. A more nuanced response, however, might be that Putin hopes to parlay the world’s growing hunger for energy into greater Russian clout — and to fill his government’s coffers with petrodollars.
 
The fact is, Russia’s economy is being fueled by oil production (see chart). In just a few years, oil and natural gas output has spiked a remarkable 50%. Russia proudly boasts of producing more oil than Saudi Arabia. read more

EXTRACT: “…there are a few companies that investors might be better off avoiding in the near term. Royal Dutch Shell (NYSE: RDSa) is one such company. In simple terms, Royal Dutch Shell faces a number of troubling issues that include a relatively weak production profile, one of the lowest reserve replacement ratios among the majors, and problems with regard to its operations in both Russia and Nigeria.”

“Simply put, the company has not had any production growth since 2002. In fact, production has declined in each and every year, and 2006 looks to be no different.” read more

EXTRACT: Co-founder Mr Hambro said his firm had seen its shares slump by almost a half since Russia’s environment agency – part of Russia’s Ministry of Natural Resources – called for the withdrawal of the company’s 54 licensing agreements. 

The boss of a London-based gold mining company is to fly to Russia for urgent talks on the firm’s future there.

Peter Hambro Mining has seen its shares slump after Russia’s environment agency called for the withdrawal of the firm’s operating licences in the country. read more

Rakteem Katakey / New Delhi December 14, 2006 
 
It’s been almost a year since the country’s largest upstream company, Oil and Natural Gas Corporation (ONGC), signed a memorandum of understanding (MoU) with the one of the world’s largest oil companies – Royal Dutch Shell – for co-operation in both the upstream and downstream sectors, but the first definitive agreement is yet to be signed. 
 
“Nothing concrete has happened so far though we are in continuous discussions with Shell. Technology sharing pacts are part of the talks,” ONGC Chairman and Managing Director R S Sharma said. 
 
Sources said the lack of progress can be attributed to a wide gap between what Shell wants and what ONGC is willing to give. Shell is interested in putting its investments in an onshore oil field in Gujarat in return for a share in the profit oil, or the extra oil that will be pumped out through use of superior technology. 
 
ONGC, however, is not keen to part with equity. “ONGC wants the technology, not the money,” a senior ONGC official said. Shell’s spokesperson declined to comment. 
 
ONGC’s crude oil recovery rate from its western fields is 25-30 per cent. Shell’s technology could increase its recovery rate to 40 per cent and above. “ONGC doesn’t want to give Shell a share in the profit oil. We are only looking for a service agreement. Talks are on regarding this,” the ONGC official said. 
 
The MoU between the two companies – signed on January 19, 2006 – covers co-operation across the full range of upstream and downstream activities, including exploration and production, coal gasification, natural gas, oil products and refining and petrochemicals.  read more

By Vladimir Socor
Wednesday, December 13, 2006
 
First Deputy Prime Minister Dmitry Medvedev An unprecedented flurry of warnings by top Russian energy officials on a single day, December 12, may mark that date as a Black Tuesday for Western energy companies investing in Russia. First Deputy Prime Minister Dmitry Medvedev, Gazprom president Alexei Miller, Energy and Industry Minister Viktor Khristenko, and the unleashed “environmental” scourge Oleg Mitvol targeted mainly Royal Dutch Shell; but they also threatened the interests of ExxonMobil, Chevron, BP, and other companies with heavy investments — or, as may turn out, exposure — in Russia. read more

14:07 | 13/ 12/ 2006 

MOSCOW, December 13 (RIA Novosti) – Russia’s environmental watchdog will hold a meeting with managers of London-based Peter Hambro Mining, the second-largest gold producer operating in Russia, the Natural Resources Ministry said Wednesday.

Last month, the Federal Service for the Oversight of Natural Resources asked the ministry to terminate five license agreements held by Peter Hambro Mining, over its failure to comply with licensing terms for prospecting work, as well as terms set out in project documents. read more