Major sanctions against Sakhalin II operator possible - govt.-1
Russia's natural resources minister said Monday he did not rule out imposing major sanctions against the operator of the vast Sakhalin II oil and gas project in the country's Far East, due to environmental violations.
The vast hydrocarbon project, led by Anglo-Dutch oil major Shell, has met with strong opposition from environmental groups and authorities over accusations of inadequate safety, massive volumes of waste disposal, seismic threats, erosion, and threats to marine life. The Ministry of Natural Resources withdrew a key permit for the project in September.
However, if Sakhalin Energy "proposes an exhaustive plan to eliminate environmental damage, and if we approve it, there will be no reason to stop the project," Yury Trutnev said.
"If such measures are not taken, other sanctions are possible," he said.
Russia's environmental watchdog said Friday the entire ecological damage from the Sakhalin II will be evaluated in late summer 2007.
Oleg Mitvol, head of the Federal Service for the Oversight of Natural Resources, said: "Sakhalin Energy, which is running the project, received approval for a feasibility study for one project, but is doing something entirely different there."
But he said there is no question of revoking the license for the development of Sakhalin deposits, and that Russia will honor is obligations.
The environmental watchdog chief said an expert group consisting of representatives of relevant government agencies, as well as environmentalists, will go to Sakhalin island next spring.
The Russian authorities' annulment of the 2003 Sakhalin Environmental Expert Review (SEER), following action from prosecutors, was met with protests from British, Dutch, U.S. and Japanese officials.
Environmental experts arrived in late September at the port of Korsakov, in southern Sakhalin, to inspect the area where excavation work was conducted earlier by project organizer Sakhalin Energy, under Sakhalin II.
Mass fish and crab kills have been reported in the area, and inspectors earlier established that a Sakhalin Energy vessel dumped a mixture of methylene dichloride and lubricating oil into the bay.
The Sakhalin II project, which is run by the Sakhalin Energy Investment Company, in which Royal Dutch Shell holds a majority stake, comprises an oil field with associated gas, a natural gas field with associated condensate production, a pipeline, a liquefied natural gas plant and an LNG export terminal. The two fields hold reserves totaling 150 million metric tons of oil, and 500 billion cubic meters of natural gas.
