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Reuters: Infighting hits Russian officials targeting Shell

Fri Dec 8, 2006 11:52 AM GMT

MOSCOW (Reuters) – Russia’s Natural Resources Ministry, which has led criticism of foreign oil firms such as Royal Dutch Shell (RDSa.L: Quote, Profile , Research), dissolved into infighting between officials on Friday, with oil giant’s top critic shut out of a meeting and calling for his own boss to be sacked.

Oleg Mitvol, the outspoken deputy head of the ministry’s ecological agency RosPrirodNadzor, was barred from a meeting about withdrawing firms’ licences at another of the ministry’s agencies, Rosnedra.

Mitvol’s office said in a statement he wasn’t allowed to attend the meeting despite having been recently appointed to the commission on licensing compliance.

In a separate development, Mitvol’s boss, the head of RosPrirodNadzor Sergei Sai, came under fire from his own boss, Russia’s Resources Minister Yuri Trutnev.

“I will ask the government for a disciplinary punishment of the head of RosPrirodNadzor, Sergei Sai,” he told a joint meeting of his ministry with top prosecutors. He said Sai should more regularly check oil firms for non-compliance.

Mitvol himself told Ekho Moskvy radio that Sai should be sacked, along with other “delinquent officials.”

Mitvol has leapt to prominence in the last three months by touring oil and gas projects and warning several foreign firms that they could lose their operating licences if they do not improve their environmental and technical records.

Analysts have said Mitvol’s criticism of Shell’s Sakhalin-2 venture, which is accused of ecological breaches, is meant to put pressure on Shell and its partners to cede a stake in the $22 billion (11.2 billion pounds) project to state gas monopoly Gazprom (GAZP.MM: Quote, Profile , Research) on better terms.

Analysts have said the pressure should subside as soon as the two firms clinch a deal. Sakhalin-2 also involves Japan’s Mitsui (8031.T: Quote, NEWS , Research) and Mitsubishi (8058.T: Quote, NEWS , Research) and is due to supply liquefied natural gas (LNG) to customers in Japan, South Korea and the United States from mid-2008.

© Reuters 2006. All Rights Reserved.

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