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Posts on ‘October 21st, 2006’

Daily Mail (UK): Russia hits Shell with demand for backtaxes

RUSSIA’S authorities opened a second front in their challenge to Shell, slapping a demand for back taxes on the Salym field in Siberia, one of the country’s largest onshore fields.

Local reports put the claim at ‘more than $10m’ (£5.4m). Shell (down 3p to 1817p) owns Salym with Sibir Energy. The Salym operating company said it would dispute the claim.

Shell is already under fire at the huge Sakhalin project, where costs have soared to £10.6bn. The higher they rise, the longer Russia must wait for revenues.

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Daily Express (UK): Russia v Shell: again

Saturday 21 October 2006

ROYAL Dutch Shell faces a new battle with Russia after receiving a bill for unpaid taxes at its Salym joint venture with Sibir Energy in Siberia.

Shell, already at loggerheads with Russia over alleged environmental breaches at the Sakhalin-2 oil and gas project, said it would fight the bill in court.

ShellNews.net: The Hans Bouman, Engel van Spronsen Sakhalin II emails published here on Monday

Sakhalin II: A potential environmental calamity?

Subject to legal injunction, candid e-mails between Hans Bouman, a natural-gas field manager, and Engel Van Spronsen, in his then capacity as Sakhalin Energy’s technical director, will be published here on Monday 23 October 2006. Both gentleman are now retired.

Some months ago we became aware from Shell insiders of a treasure trove of “Hans” Bouman” emails which have been widely circulated as collector items by Shell insiders because of their outspoken, prophetic and eloquent content.  

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Sakhalin II: Apocalypse Now?

The Times: Putin rejects EU demand to open up gas supplies

Times

Saturday 21 October 2006

From David Charter in Lahti
 
A DEFIANT President Putin defended his hardline attitude towards Georgia and his refusal to open up Russian energy supplies against a series of complaints from EU leaders over their summit dinner last night.

The Russian leader refused to sign an energy agreement with the EU that would involve greater openness from his country but pledged to work towards a longer term pact that he said would address Europe’s concerns.

In the face of strongly worded criticism over the dramatic worsening of Russian relations with Georgia, Mr Putin told the 25 European heads of government gathered in Lahti, Finland, that the problem was not of his making and insisted that he wanted to avoid bloodshed. 
 
Invited to the one-day summit dinner for an informal discussion, the Russian leader wrongfooted his hosts with opening remarks in which he challenged them to ask him anything, whether connected to their agenda of energy security or not.

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The Times: Sakhalin decision

Saturday 21 October 2006

Russia is to decide on the budget for the Shell-led Sakhalin-2 oil and and gas project by December, Andrei Dementyev, Russia’s deputy energy minister, said.

Shell has infuriated Russian officials with multibillion-dollar cost overruns on the project.

Daily Telegraph: Energy Database: Saturday 21 October 2006

• Royal Dutch Shell and its partners in Sakhalin-2 will get a chance to repair environmental damage caused by the $22bn oil and gas venture, Russia’s natural resources minister said, as the government softens a campaign to increase control over the development.

• British Energy’s shares fell as much as 5.3pc after the company’s biggest shareholder, Deutsche Bank, sold part of its stake.

• Shares of Ramco Energy, a Scottish oil and gas explorer, jumped as much as 30pc after the company said a Texas court upheld a legal decision freeing it from paying damages in a legal dispute.

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The Guardian: EU clash on warning to Putin over gas supplies

· Compromise after France and Germany disagree
· Foreign investments must be secure, Russia told

Nicholas Watt in Lahti
Saturday October 21, 2006

Jacques Chirac and Angela Merkel clashed yesterday on how to deal with Vladimir Putin as European leaders tried to hammer out a common approach on the EU’s relations with Russia.

Hours before President Putin took centre stage at an EU summit in Lahti the leaders of France and Germany disagreed on the strength of a warning to Russia after gas supplies were cut last winter.

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UPI: Geologist: Earth has lots and lots of oil

SPOKANE, Wash., Oct. 20 (UPI) — A University of Washington economic geologist says there is lots of crude oil left for human use.

Eric Cheney said Friday in a news release that changing economics, technological advances and efforts such as recycling and substitution make the world’s mineral resources virtually infinite.

For instance, oil deposits unreachable 40 years ago can be tapped using improved technology, and oil once too costly to extract from tar sands, organic matter or coal is now worth manufacturing. Though some resources might be costlier now, they still are needed.

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RIA Novosti: Sakhalin II problem can be resolved by talks – Putin

President Putin

10:37 | 21/ 10/ 2006

LAHTI (Finland), October 21 (RIA Novosti) – The problem around the giant Sakhalin II oil and gas project on Russia’s largest Far East island may be resolved through talks, Russian President Vladimir Putin said Friday.

“We believe that we should sit at the [negotiation] table and seek an agreement. We are convinced that we will find a resolution,” Putin told a news conference following an informal EU summit.

He said the Sakhalin II project is facing not only ecological problems, because foreign investors are demanding a two-fold increase in their spending.

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AlterNet: Bush’s Petro-Cartel Almost Has Iraq’s Oil

Parts One & 2

By Joshua Holland, AlterNet. October 2006.

Even as Iraq verges on splintering into a sectarian civil war, four big oil companies are on the verge of locking up its massive, profitable reserves, known to everyone in the petroleum industry as “the prize.”

Iraq is sitting on a mother lode of some of the lightest, sweetest, most profitable crude oil on earth, and the rules that will determine who will control it and on what terms are about to be set.

The Iraqi government faces a December deadline, imposed by the world’s wealthiest countries, to complete its final oil law. Industry analysts expect that the result will be a radical departure from the laws governing the country’s oil-rich neighbors, giving foreign multinationals a much higher rate of return than with other major oil producers and locking in their control over what George Bush called Iraq’s “patrimony” for decades, regardless of what kind of policies future elected governments might want to pursue.

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The Wall Street Journal: Oil News Roundup: October 20, 2006 4:43 p.m.

THE WALL STREET JOURNAL ONLINE
October 20, 2006 4:43 p.m.

Crude-oil futures tumbled nearly $2 a barrel, settling at less than $57 a barrel on the New York Mercantile Exchange, despite OPEC’s bigger-than-expected promise of a production cut, raising doubts about the cartel’s ability to influence prices. Here is Friday’s roundup of oil and energy news:

* * *
PUSHING PUTIN: European Union leaders said they would push Russian President Vladimir Putin to commit to a new, legally binding energy partnership that would ensure supplies of oil and gas for Europe. After a one-day summit to forge a united front, the 25 EU leaders sat down to a potentially tense working dinner with Mr. Putin, eager to secure oil and gas from resource-rich Russia but concerned about its reliability as a source.

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The Wall Street Journal: Putin Optimistic On Accord With Shell On Sakhalin-2

DOW JONES NEWSWIRES
October 20, 2006 5:49 p.m.
 
MOSCOW (AP)–Russian President Vladimir Putin, speaking Friday in Finland, said he was optimistic his government would reach an agreement with Royal Dutch Shell PLC (RDSA) over the troubled Sakhalin-2 liquefied natural gas project, but said Russia was unwilling to agree to a doubling of its costs.

Shell’s original so-called production sharing agreement, signed in the 1990s, allows the company and its partners to recoup all expenses before sharing any profits with the Russian state.

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Itar-Tass: Russia to remain reliable energy partner for Europe – Kremlin

21.10.2006, 00.05 
 
LAHTI, Finland, October 21 (Itar-Tass) – Russia will always remain Europe’s reliable partner in the field of energy resources, and a decision by OAO Gazprom, the major Russian producer of natural gas, to redirect exports of gas from the Shtokmanovsky offshore deposit to Europe provides a crucial confirmation that Russia will guarantee supplies of fuel to its neighbors, the Kremlin press service said.

It circulated a special statement at an informal Russia-EU summit in the Finnish town of Lahti.

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Irish Times: Russia and EU agree legally binding energy deal

Oct 21, 2006

The EU and Russia last night put aside recent disputes over energy policy and said they would work towards a legally binding energy deal based on mutual trust, writes Jamie Smyth in Lahti, Finland

European Commission president Jose Manuel Barroso said Russian president Vladimir Putin agreed on the need not to politicise energy relations in the future.

“We should not let energy divide Europe and Russia as communism once did,” said Mr Barroso, who stressed the mutual dependency of Russia and the EU on energy issues.

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Irish Times: Intervention urged in Corrib gas row

Oct 21, 2006
Lorna Siggins, Marine Correspondent

Mayo TD Dr Jerry Cowley (Ind) has called on the Government to intervene in the Corrib gas dispute before someone is seriously hurt.

The situation at the Shell Corrib gas terminal is now akin to a “pressure cooker”, the TD said, following yesterday’s Shell to Sea “day of action” involving some 300 protesters at Bellanaboy.

The largest protest to date since Shell staff returned to work three weeks ago was marked by a tense atmosphere, with several scuffles and one arrest. However, Chief Supt Tony McNamara, head of the Garda’s Mayo division, paid tribute to Dr Cowley and Willie Corduff, one of the Rossport Five, for ensuring that the demonstration was “largely peaceful”.

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Irish Times: Protests over Shell pipeline

Oct 21, 2006

Madam, – Shell E&P Ireland, with the help of Minister Noel Dempsey and sections of the media, has succeeded in portraying the Shell to Sea campaign as stubborn, intransigent and unwilling to compromise with the beleaguered multinational.

Speaking on RTE radio’s News at One last Monday, the Minister claimed that protesters had yet to offer a “reasonable” solution to the conflict. This is a remarkable comment: in fact the protesters have been offering a reasonable solution since November 2000, when they first called for the gas to be processed just offshore, as happens at Kinsale and at similar projects across the globe.

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AP Worldstream: Putin optimistic Russian government will agree with Shell on Sakhalin-2 project

Oct 20, 2006
ALEX NICHOLSON

President Vladimir Putin, speaking Friday in Finland, said he was optimistic his government would reach an agreement with Royal Dutch Shell over the troubled Sakhalin-2 liquefied natural gas project, but said Russia was unwilling to agree to a doubling of its costs.

Shell’s original so-called production sharing agreement, signed in the 1990s, allows the company and its partners to recoup all expenses before sharing any profits with the Russian state.

Royal Dutch Shell said last year it would double the costs at the project it leads to nearly US$22 billion (A17.5 billion).

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Financial Times: EU urges Putin to honour oil contracts

By George Parker in Lahti

Published: October 20 2006 18:53 | Last updated: October 21 2006 00:55

European leaders on Friday night pressed Vladimir Putin, Russia’s president, to honour contracts with western oil companies, amid fears in the EU over Moscow’s tightening grip on the energy sector.

In a strained summit dinner in the Finnish town of Lahti, EU leaders also chided Mr Putin on questions of human rights, press freedom and Moscow’s tough treatment of the former Soviet republic of Georgia.

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