Reuters: Russia probes environment agency, scourge of Shell

Wed Oct 18, 2006 12:24 PM BST
Mikhail Yenukov

MOSCOW (Reuters) – Russian criminal investigators removed documents on Wednesday from the state environmental agency that has put pressure on Royal Dutch Shell and other foreign oil firms, but officials said the probe was not linked to the agency’s own investigations.

Oleg Mitvol, the outspoken deputy head of the RosPrirodNadzor environmental watchdog, said inspectors arrived unannounced early on Wednesday.

“Two investigators from the Interior Ministry’s organised crime department came to RosPrirodNadzor to remove documents from our accountant’s office,” Mitvol told Reuters.

Yevgeny Artyomov, spokesman for the Interior Ministry’s organised crime and terrorism department, said the investigators were seeking documents for a case involving the Yuzhno-Tambeisk gas condensate field in Siberia.

“It should be underlined that carrying out this action in no way demonstrates that law enforcement agencies have any grievances about the activities of (RosPrirodNadzor),” he said.

Mitvol said the investigation was unrelated to the Shell-led Sakhalin-2 project, which has infuriated Russian officials by doubling its budget to more than $20 billion (11 billion pounds).

Mitvol has been the most vocal critic of Sakhalin-2 and wants its environmental permit revoked.

Analysts say environmental criticism of the project is part of a Kremlin drive to put pressure on Shell and other foreign oil firms operating in Russia to cede control or accept less favourable terms, which would be likely to hand more power to state-owned companies.

INVESTIGATING THE INVESTIGATORS

But Russian authorities have been at pains to show they are scrupulously fair in dealing with foreign oil firms.

On Tuesday Sakhalin prosecutors summoned the local head of RosPrirodNadzor, Dmitry Belanovich, and asked him to supply a full list of inspectors’ names and information about their actions in October.

The Ministry of Natural Resources, which Mitvol’s office is part of, said in a statement that the Sakhalin prosecutors acted after Sakhalin Energy, the operating company of Sakhalin-2, complained “about the wrongful actions of RosPrirodNadzor in Sakhalin while carrying out supervisory and control checks.”

Mitvol told Reuters that more highly placed prosecutors had cancelled the order to carry out the checks on his agency.

Mitvol’s inspectors are expected to present a slew of new complaints about Sakhalin-2 during a visit to the Far East by Russian Natural Resources Minister Yuri Trutnev on October 24-26.

Russia has threatened Shell with the full armoury of sanctions at its disposal if it fails to address environmental violations at Sakhalin-2, the world’s biggest liquefied natural gas project and Russia’s top foreign investment.

Trutnev has said the concerns include deforestation and damage to the sea around the Pacific island of Sakhalin, as well as sand clogging river beds and the potential for pipeline damage in an area prone to mudslides.

Mitvol has vowed to investigate every big oil firm in Russia and has already launched inspections of oilfields and pipelines run by Russia’s biggest oil producer, LUKOIL.

But analysts say his wider checks may be designed as a fig-leaf to conceal a Kremlin attempt to put pressure on a few foreign ventures such as Sakhalin-2.

© Reuters 2006. All rights reserved.

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