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RIA Novosti: Torrential flooding puts Sakhalin II pipeline under threat

14:23 | 03/ 08/ 2006 

MOSCOW, August 3 (RIA Novosti) – Torrential flooding in Russia’s Far East could destroy an oil and gas pipeline in one of the country’s most ambitious energy projects, the Natural Resources Ministry said Thursday.

According to a report from the Russian Academy of Sciences on geological processes endangering shoreline-pipelines in the Sakhalin II energy project and submitted to Oleg Mitvol, a deputy head of Russia’s watchdog in the field, about 20 kilometers (12.4 miles) are under threat from floodwaters, which could endanger human lives as well as lead to an environmental disaster.

“The volume of simultaneous bursts of flooding in the zone of the pipeline’s route may amount to 500,000 cubic meters,” Mitvol said in a ministry news release. “Only 70,000 cu m of torrential flood waters may damage an underground pipeline.”

The report suggested suspending the construction of the pipeline while an environmental report is conducted to identify ways to reduce the risk of pollution.

The Sakhalin-II product sharing agreement was signed in 1994 between Russia and the Sakhalin Energy Investment Company, which currently comprises Shell Sakhalin Holding (55%), Mitsui Sakhalin Development (25%) and Diamond Gas Sakhalin (20%). It was the first PSA to be signed in Russia and came into force in 1996.

The Sakhalin-II project includes an oil field with some associated gas production, a natural gas field with associated condensate production, pipeline, a liquefied natural gas plant, and an LNG export terminal. The total reserves of the two fields are 150 million metric tons of oil and 500 billion cubic meters of natural gas.

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