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RIA Novosti: Watchdog seeks to overturn Sakhalin II environment study

17:33 | 04/ 08/ 2006 

MOSCOW, August 4 (RIA Novosti) – Russia’s watchdog for natural resources demanded Friday that a court annul a positive decision of the state environmental inspectorate on the development of two sectors of the Sakhalin II project in the country’s Far East.

According to an earlier 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 report suggested suspending the construction of the pipeline while a new environmental survey 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 associated gas, 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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