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UpstreamOnline: Piebalgs’ concern at Sakhalin moves

By Upstream staff

The European Commission said today that it took “very seriously” a decision by Russia to revoke environmental approvals for the $20 billion Sakhalin 2 oil and gas project led by Shell.

“I take this announcement very seriously indeed,” Energy Commissioner Andris Piebalgs said in a statement, adding that Shell should be given a chance to respond to any concerns of Moscow about the project off Russia’s Pacific Coast.

“I believe that they should be clearly and unequivocally identified by the Russian authorities and Shell must be given an appropriate time to resolve them according to defined and clear criteria, set out in advance,” Piebalgs said.

Energy ties between the EU and Russia were based on “mutual respect of transparency, predictability and non-discrimination” which applied “as much to the ability of EU companies to invest in Russia as to the right of Russian companies to sell gas and oil freely at both upstream and downstream levels in the EU”.

Piebalgs also said he would write soon to Russia’s energy minister on this issue.

Russia and the European Union have had an edgy energy relationship in 2006, sparked by a January gas pricing dispute between Ukraine and Moscow that briefly disrupted supplies to Europe.

Since then the 25-nation bloc and the former Soviet giant have sought to strengthen energy ties, but the two sides have failed to see eye to eye on what constitutes equal access to each other’s markets – a goal they both profess to pursue.

Russia supplies about a quarter of the EU’s gas, and that figure is expected to rise in the coming years.

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