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The Observer: Moscow targets British firms in wake of Litvinenko affair

Alex Brett
Sunday July 29, 2007

British Energy companies in Russia are coming under more intensive scrutiny from Moscow in the aftermath of the Litvinenko affair.

The Russian ministry of national resources has accused JKX Oil and Gas and Dana Petroleum of exaggerating their own reserves by claiming they have deposits in other Russian-owned fields. The deputy chief of the federal natural resources use supervision service (Rosprirodnadzor), Oleg Mitvol, said Dana attracted their attention when it said ‘it had reserves that belong to [Russian oil firm] Lukoil’.

JKX Energy fell foul of the ministry when it claimed on its website to have a licence for a 30.5 per cent stake in the Inchke More field; according to Moscow, that licence was withdrawn in 2003. The Russian government also raised concerns over JKX’s purchase of the Southern Russian energy firm Yuzhgazenergy.

The decision to target British firms in Russia follows pressure on BP and Shell to hand over stakes to Gazprom, and after Imperial Energy was accused of making dubious claims that it had 3 billion barrels of Siberian oil reserves.

Rosprirodnadzor also intends to investigate subsidiaries of TNK-BP and British Timan Oil and Gas.

The news hit share prices with JKX closing 6.37 per cent down on Friday.

http://observer.guardian.co.uk/business/story/0,,2136742,00.html

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