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Reuters: Russia watchdog Mitvol faces disciplinary rap

Thu Dec 14, 2006 6:35am ET

MOSCOW, Dec 14 (Reuters) – Russia’s outspoken environment watchdog Oleg Mitvol, who has waged a harsh campaign against the Shell-led Sakhalin-2 energy project, faced disciplinary proceedings on Thursday that could herald his dismissal.

The head of state environmental agency RosPrirodNadzor, Sergei Sai, has asked Resources Minister Yuri Trutnev to hand Mitvol a formal warning, a ministry spokesman said.

“The document has been submitted to the ministry, but it hasn’t been reviewed by the minister himself,” said ministry spokesman Rinat Gizatullin. “We will examine it and respond at the start of next week.”

If Mitvol, who is Sai’s deputy at the agency, receives a second such warning he would be sacked.

Mitvol has campaigned against alleged ecological violations by Royal Dutch Shell (RDSa.L: Quote, Profile , Research) on Sakhalin-2, the world’s largest liquefied natural gas project. This week, he threatened international damages claims of up to $30 billion.

But his future has been cast into doubt since he was shut out of a meeting of a sister agency last week and news broke this week that Shell is nearing a deal to sell control of Sakhalin-2 to state-controlled gas monopoly Gazprom (GAZP.MM: Quote, Profile , Research).

Analysts say that Mitvol has been deployed as an instrument to exert pressure on Shell to cede control of Sakhalin-2 on favourable terms to Gazprom, which sources say could acquire 30 percent out of Shell’s 55 percent stake in the project.

Japan’s Mitsui & Co (8031.T: Quote, NEWS , Research) and Mitsubishi Corp (8058.T: Quote, NEWS , Research) may sell 10 percent each out of their respective stakes of 25 percent and 20 percent, enabling Gazprom to secure a bare majority — although Shell should stay on as project operator.

Neither Sai nor Mitvol were immediately available for comment. But Mitvol told Ekho Moskvy radio that he was being punished for being too effective at his job.

“I’m someone who sticks in the throat of a lot of bureaucrats,” Mitvol told Ekho Moskvy.

© Reuters 2006. All Rights Reserved.

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