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December 22nd, 2006:

Daily Telegraph: F&C hoists red flag on Russian firms listing in UK

By Russell Hotten
Last Updated: 12:07am GMT 23/12/2006

One of the City’s leading shareholder groups has warned about the “inhospitable” and “difficult” climate facing investors and companies wanting to do business in Russia. F&C Asset Management also questioned the wisdom of allowing so many Russian companies to list in London when their standards of corporate governance were below those in the UK.  

The comments, by Karina Litvack, F&C’s head of governance and sustainable investment, come after Royal Dutch Shell’s bruising encounter with the Kremlin over the company’s huge Sakhalin-2 oilfield. Ms Litvack said: “We take into account the extent to which a government creates an inhospitable climate for investors and is prepared to enforce the rule of law. What’s happened makes it a very dodgy place [for investors].” read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Financial Times: BP under pressure on Kovykta

By Arkady Ostrovsky in Moscow
Published: December 22 2006 21:00 | Last updated: December 22 2006 21:00

TNK-BP, the Anglo-Russian oil joint venture, is bracing itself for a full investigation within weeks into its licence agreement for a giant Siberian gasfield as the Kremlin tightens its grip on the country’s energy resources.

Russia has used environmental audits and regulatory threats to restore state dominance over oil and gas supplies. This week saw Gazprom take a controlling stake in Royal Dutch Shell’s Sakhalin-2 project after months of pressure. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Daily Mail: Blackmail fear after Russia doubles the price of its gas

President Putin

President Putin: Supply threats

By MAIL FOREIGN SERVICE
Last updated at 22:00pm on 22nd December 2006
 
Fears that Russia is using energy supplies as a political weapon increased last night after Moscow forced Georgia to accept a doubling of gas prices.

The deal came within hours of a threat by Gazprom, Russia’s statecontrolled energy giant, to cut off supplies to the former Soviet republic from January 1.

Georgia had called the price increase ‘unacceptable’ and ‘politically motivated’. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

MosNews: Investor Confidence Shaken by Actions of Russia’s Environmental Watchdog

Rosprirodnadzor Flag

(Rosprirodnadzor’s flag)

Created: 22.12.2006 15:57 MSK (GMT +3), Updated: 17:14 MSK

Peter Hambro, executive chairman of Peter Hambro Mining, which develops gold deposits in Russia, said that a recent spat with Russia’s environmental watchdog Rosprirodnadzor had greatly damaged investor confidence in the country and set the company back.

MosNews has reported that the Russian environmental watchdog raised doubts over gold miner’s licenses about three weeks ago. But several days ago, just as he was being attacked by his direct superior, deputy head of Rosprirodnadzor Oleg Mitvol said that all of Peter Hambro’s license issues were resolved and that the company could continue its operations. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Yomiuri Shimbun (Japan): Sakhalin-2 deal sells Mitsubishi, Mitsui short: ‘Mitsui, Mitsubishi and Royal Dutch Shell were all betrayed…’

Hiroshi Ikematsuand Tamaki Aikyo Yomiuri Shimbun Staff Writers
(Saturday Dec. 23, 2006)

Mitsui & Co. and Mitsubishi Corp. have bowed to pressure from the Russian government by agreeing to hand over control of the Sakhalin-2 project to Russia’s state-owned gas monopoly Gazprom.

Mitsui and Mitsubishi, along with the Royal Dutch Shell group, sought an early conclusion to the negotiations by holding a summit meeting of company heads in Moscow on Thursday, less than a week after the last meeting. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Bloomberg: Sullenger of Gaia Says Sakhalin Pact `Great News for Gazprom’

Dec. 22 (Bloomberg) — Coast Sullenger, a fund manager at Gaia Resources, talks with Bloomberg’s Jeremy Naylor and Guy Collins from Geneva about Royal Dutch Shell Plc’s decision to sell 50 percent plus one share in its Sakhalin-2 oil and gas project to OAO Gazprom for $7.45 billion. They also talk about the risks of investing in Russia and emerging markets. Shell, Mitsui Co. and Mitsubishi Corp. will each sell half of their stakes in the Sakhalin-2 project to Gazprom. (Source: Bloomberg) read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Capital Spectator: ANOTHER KREMLIN VICTORY IN ENERGY

December 22, 2006

If you’re looking for one more reason to worry about the future of global oil production, take a gander at the news on Royal Dutch Shell’s coerced sale of a majority stake in its Sakhalin-2 oil and gas project in Russia to the state-controlled Gazprom.

On the surface, it all looks quite innocent. Shell sells 50 percent plus one share of the project to Gazprom. The deal comes after a 12-month effort by the Kremlin of running interference on the project, reportedly because of environmental concerns. Shell and its partners read the writing on the wall and threw in the towel. The result: another victory for the Russian government’s not-so-subtle strategy of nationalizing the lion’s share of its energy business. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

AFX News Limited: Royal Dutch Shell ratings unaffected by Sakhalin deal – S&P

EXTRACT: S&P said it estimates that the transaction reduces Shell’s year-end 2005 proved reserves by some 9 pct or 1 bln barrels of oil equivalent, and reduced proved reserve life of 9.2 years by about 0.8 years

THE ARTICLE

12.22.06, 8:31 AM ET

PARIS (AFX) – Standard & Poor’s Ratings Services said its outlook on Royal Dutch Shell PLC Shell, (‘AA/Stable/A-1+’) is unchanged, following a signed agreement between the company, two Japanese co-shareholders and OAO Gazprom to give Gazprom majority control of Sakhalin Energy Investment Company Ltd (SEIC). read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

London Evening Standard: Market report: Friday close

Mickey Clark,
22 December 2006

Oil giant BP shrugged off early selling pressure to post a rise of 4½p at 571½p despite City concerns that it may be next in the Kremlin’s firing line as it moves to reclaim Russia’s extensive oil and gas assets. 

The fears follow news that the Russians are paying rival oil explorer Royal Dutch Shell and its Japanese partners $7.5bn (£4.3bn) to buy out the Sakhalin-2 project in Siberia and hand control to Gazprom.

The deal was personally signed by President Putin as if to underline the country’s determination. The message will have been taken on board by BP management, which has ploughedbns of pounds into its TNK-BP joint venture. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Daily Mail: Shell ousted as Putin tightens grip

Sam Fleming,
22 December 2006

Vladimir Putin strengthened his iron grip on Russia’s energy industry by wresting control of the world’s biggest oil and gas project from Royal Dutch Shell.

State-run gas giant Gazprom bought a controlling stake in the vast Sakhalin-2 scheme for £3.8bn after Shell became hopelessly bogged down in environmental disputes and cost over-runs.

Shell’s stake will drop from 55% to 27.5%, while Gazprom will secure 50% of the project plus one share. Shell’s Japanese partner Mitsubishi’s holding will fall to 12.5%, while Mitsui’s drops to 10%. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

AFX News Limited: London shares open lower as Shell’s Russian woes add to weak Wall St

EXTRACT: In a note to clients, the broker said the deal is not financially favourable to Shell — Gazprom is not paying the current net present value for its stake in Sakhalin-2.

THE ARTICLE

12.22.06, 3:36 AM ET

LONDON (AFX) – Leading share edged lower at open, mirroring a a weak close on Wall Street, with oil heavyweights under the cosh on news Royal Dutch Shell has cut its stake in Russia’s Sakhalin-2 project, dealers said.

At 8.15 am, the FTSE 100 was down 7.7 points at 6,176.0, with the broader indices mixed. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Globe & Mail (Canada): Shell gets go-ahead on oil sands expansion

Panel reviewing $12.8-billion project hints future projects will face tougher hurdles

DAVID EBNER

CALGARY — Shell Canada Ltd.’s $12.8-billion oil sands expansion in northeastern Alberta was approved yesterday, but the panel that reviewed the project said governments don’t have “sustainable long-term solutions” to properly manage the region’s rapid growth.

The decision suggested future projects will face more difficult hurdles for approval as environmental and community challenges mount in and around Fort McMurray, 435 kilometres northeast of Edmonton, where about $100-billion of work is predicted over the next decade. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Wall Street Journal: Shell Cedes Control Of Pivotal Russian Oil Project

The Wall Street Journal Sakhalin Map

Deal With Gazprom Dims
Output, Reserves Prospects
But Eases Kremlin Pressure
By CHIP CUMMINS in London and GUY CHAZAN in Moscow
December 22, 2006; Page A3

Royal Dutch Shell PLC’s decision to relinquish control of a massive oil and natural-gas project on the far eastern Russian island of Sakhalin significantly crimps the Anglo-Dutch oil giant’s prospects for future production and replacing its reserves.

But it solidifies Kremlin support for the project, removing short-term questions over its timing and improving Shell’s longer-term chances of remaining a big player in Russia. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

THE WALL STREET JOURNAL ONLINE: Oil News Roundup: December 21, 2006 4:47 p.m.

Crude-oil futures fell from a three-month high to less than $63 a barrel on the New York Mercantile Exchange as forecasts for warmer-than-average weather in the U.S. Northeast threatened heating-oil demand and as traffic in Texas shipping lanes started to return to normal after a week of heavy fog.

Here is Thursday’s roundup of oil and energy news:

* * *
SHELL DEALS WITH RUSSIA: Royal Dutch Shell and its partners agreed to hand over 50%, plus one share of the Sakhalin-2 oil project to OAO Gazprom, the state-controlled Russian giant, for $7.45 billion in cash. By most estimates, the deal provides Gazprom with extremely attractive terms, essentially allowing it to buy into the project late in its development stages with little project risk and at a price that would be similar to one it could have paid as a ground-floor investor. But it does greatly improve Shell’s longer-term chances of remaining a big player in Russia. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Guardian: Sakhalin issues ‘settled’ – as Russia takes 50% stake

Environmental problems vanish with handover Putin gives backing minutes after deal

Simon Bowers
Friday December 22, 2006

Vladimir Putin has declared that the environmental questions surrounding the Sakhalin-2 oil and gas project have been settled – just minutes after state-controlled Gazprom took control of the $22bn (£11bn) operation from Shell in a deal mired in controversy.

“As far as I’ve been informed, the fundamental issues can be considered resolved,” the president was quoted as saying by the Interfax news agency. “Russia is satisfied by a serious and businesslike approach of the partners.” His comments came after he met officials from Gazprom and Sakhalin-2’s shareholders, Shell, Mitsui and Mitsubishi. He played down the Kremlin’s role in negotiations, insisting Gazprom’s “decision to participate … was a corporate decision”. read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Guardian: Trust hit by environment watchdog, says mining boss

Marianne Barriaux
Friday December 22, 2006

Peter Hambro Mining yesterday got a clean bill of health from Russia’s natural resources ministry after doubts were raised over the gold miner’s licences three weeks ago. But Peter Hambro, executive chairman at the Aim-listed group, said the spat with Russia’s environmental agency had greatly damaged investor confidence in the country and set the company back.

“Slowly but surely since we have listed [in April 2002], we have built up trust. And at a stroke, by one press conference, all that has collapsed. No amount of press releases saying ‘you’re good’ or ‘we’re not stealing’ will affect it. It’s a question of going back and rebuilding investor trust again. It will take a very long time.” read more

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.
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