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Houston Chronicle: Russia grabs oil field: Government takes offshore area from Exxon Mobil

By ALEX NICHOLSON
Associated Press

MOSCOW – An offshore oil field originally claimed by Exxon Mobil Corp. has been given to state-controlled oil giant Rosneft, a Russian government official said Friday.

The Kremlin, which appears to be seeking a greater stake in the country’s natural resources at a time of high prices, has dealt a series of blows to Western oil companies recently.

The decision by the Natural Resources Ministry to give the Lebedinsky field off Sakhalin island to Rosneft comes days after the ministry announced it would pull a key environmental permit at a $20 billion liquefied natural gas project on the Pacific island controlled by Royal Dutch Shell.

In Washington on Friday, State Department spokesman Tom Casey said the U.S. was very concerned by the recent Russian government actions toward Shell, saying the actions cast doubt on Russian commitments made at the G-8 summit this summer in St. Petersburg.

Russia agreed to “transparent, efficient and competitive energy markets, as well as specific obligations to uphold contracts,” he said.

The moves by Russian regulators have also prompted statements of concern by governments in London and Tokyo.

Exxon Mobil had originally asked to have the Lebedinsky bloc allotted as part of its adjacent Sakhalin-1 project. Those requests were rejected, and a spokeswoman for the Natural Resources Ministry was quoted by Dow Jones Newswires as saying that only Rosneft had applied for the field as of a Sept. 14 filing deadline.

Earlier, Exxon Mobil’s work at Sakhalin-1 was complicated by new environmental checks at its recently completed De Kastri oil terminal.

In a strange twist that hinted at possible internal governmental dissent over the Shell probe, a Russian state regulator said it had refused to revoke the environmental permit at Shell’s Sakhalin-2 project. A short while later, however, the regulator, Rostekhnadzor, retracted that statement.

A Rostekhnadzor spokesman said the information was incorrect and the news release had been annulled.

In another development, ministry officials said this week that French company Total’s license to develop Arctic fields at its Kharyaga project was under review for possible cancellation.

Meeting with French President Jacques Chirac in Paris on Friday, President Vladimir Putin told reporters that rumors that Total could lose its license were exaggerated.

Analysts have interpreted the moves as a government effort to seek greater influence over Total’s Kharyaga, Exxon Mobil-led Sakhalin-1 and the Shell-led Sakhalin-2.

The Western oil companies are developing those projects under so-called production-sharing agreements — deals that were struck in the early 1990s when oil prices were low and Russia lacked the funds to develop reserves on its own. Russia is eager to take greater control of its hydrocarbons and appears to be angling to renegotiate deals to benefit its own energy companies.

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1 Comment on “Houston Chronicle: Russia grabs oil field: Government takes offshore area from Exxon Mobil”

  1. #1 Virgil Constantinescu
    on Sep 23rd, 2006 at 10:43

    This guy from Houston Chronicle don’t know where it’s Sakhalin,or write order articles.
    In this case,it’s about a extended of Sakhalin 1-project.They lost the bid for this deposit.What it’s the problem?Somebody come with a better offer..If you call Exxon Mobil Corporation ,it must to have all the oilfields in the world?

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