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How Shell lost its majority stake in Sakhalin II

Extracts from the ebook “John Donovan, Shell’s Nightmare” (now available on Amazon websites globally)

From pages 9 and 10. Extracts from three articles which mention my contact with Russian government minister Oleg Mitvol.

Extract (From Prospect Magazine article)

IT IS NOT the kind of place you would expect to find at the centre of a global energy war. John Donovan’s office is in a modest house in a suburb of Colchester. No electronic maps of Europe adorn his walls, as they do the walls of Gazprom’s Moscow control room. And nor are there any butlers bringing cups of tea and expensive biscuits, as you find at Shell’s head office on the Thames. There is just Donovan’s 89-year-old father, Alfred, in the room next door. But it is the home of www.royaldutchshellplc.com, a website which can claim to have cost Shell billions of dollars and helped Vladimir Putin score another victory over western energy interests.

Oleg Mitvol – the deputy head of Rosprirodnadzor, who was entrusted with the job of bringing Sakhalin Energy to heel had by last December accumulated sufficient evidence of Shell’s and its partners’ abuses to lay charges against the consortium amounting to $30bn. There were also threats that the licence to develop the project could be removed. With the green gun at its head, Shell allowed Gazprom to take control of the project giving Russia an immediate share of profits and oversight of costs. Taking the role of the humiliated man seriously, Shell’s head Jeroen van der Veer thanked Putin for helping to resolve the conflict.

What most astonished Shell was the detailed inside knowledge Mitvol had accumulated about the company’s abuses. Some in the company suspected industrial espionage.

But it was actually information that the Donovans of Colchester were passing to Mitvol. EXTRACTS END

Mitvol also featured in a Sunday Times half-page article by Danny Fortson published 19 July 2009 under the headline: “Two men and a website mount vendetta against an oil giant

Extract

In 2005, when the Kremlin was building a case against Shell over the Sakhalin gas project, the Donovans provided confidential documents regarding alleged environmental infractions directly to Oleg Mitvol, the minister who led the case. Shell was ultimately forced to sell a stake to the Russians, leading to billions in lost revenue. Mitvol publicly acknowledged the help provided by the Donovans in building his case.

Extract from a related half page article by Russell Hotten published by The Guardian on 26 October 2009 under the headline: “92-year-old’s website leaves oil giant Shell-shocked

Four years ago Shell was embroiled in a bitter dispute with Russia’s environmental regulator over drilling for gas at Sakhalin Island. It was eventually forced to relinquish its majority stake in the project, costing Shell billions in lost revenue. Later, the regulator, Oleg Mitvol, publicly acknowledged the Donovans’ help in getting information about alleged claims of environmental abuses by Shell. Earlier this year the site disclosed plans for thousands of Shell job losses. And now, Donovan says, he is helping US investigators looking into the award of oilfield drilling licenses, providing them with information leaked to his website.

I was, in fact, dealing with a senior agent from the Inspector General’s Office of the US Department of the Interior keen to receive Shell insider information, which I supplied.

Extracts from the John Donovan ebook ends.

EARLIER EXTRACTS

John Donovan, Shell’s nightmare: Genesis

John Donovan, Shell’s nightmare: Süddeutsche Zeitung article

GERMAN TV: John Donovan’s revelations cost Shell billions

ARGUS FSU ENERGY INTERVIEW WITH KREMLIN ATTACK DOG, OLEG MITVOL

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