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Financial Post – Canada: Russia’s focus on environment seen as attempt at control: Energy

Published: Oct 25, 2006

MOSCOW – Russian environmental prosecutors are considering cancelling licences for 17 oil companies, including a subsidiary of state oil firm Rosneft, a top environmental official said yesterday. “Cases have been forwarded to the environmental prosecutor for review regarding 17 companies,” including Rosneft-Purneftegaz and shattered oil major Yukos, news agency ITAR-TASS quoted Sergei Sai, the head of environmental monitoring agency Rosprirodnadzor, as saying. Rosneft-Purneftgaz may lose five licences as a result of the cases, Mr. Sai said.

Russian environmental agencies have launched a massive campaign of environmental checks and threatened licence removals in recent weeks, frequently at the initiative of the flamboyant Oleg Mitvol, the deputy head of Mr. Sai’s agency.

An official at the ministry of natural resources, which oversees Mr. Sai’s agency, said yesterday that licence removals were a last resort. “Licences should be removed only in the most extreme, flagrant cases — otherwise economic measures against negligent companies” should be used, RIA Novosti quoted ministry official Sergei Fedorov as saying.

An initial wave of pressure against major foreign oil companies such as Shell, ExxonMobil and Total led to complaints by foreign officials of possible unfair treatment. Agencies have since targeted Russian groups such as No. 1 private oil producer Lukoil and GazpromNeft, the oil-producing branch of state gas monopoly Gazprom. The companies are accused of having failed to respect environmental norms in their activities, but many analysts see the initiative as part of a longstanding trend of tightening government control over the energy sector.

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