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Ethical Corporation: Russia, again

January 2007

Russia has featured heavily in the news, following the death of former KGB agent Alexander Litvinenko. Speculation is raging over whether the assassination was ordered by president Vladimir Putin’s Kremlin, or by Chechen separatists.

Shell’s Sakhalin 2 project in the Russian far east has also been in the spotlight. In early December, Russia suspended 12 water-use licences. Coming only two months after environmental licences were revoked, this step was seen as a further move by the Russian authorities to pressure Shell into allowing much greater Russian ownership of the project.

If that was the intention, then it worked. Little more than a week after the suspension of the water licences, news came that Shell had made a series of offers to Russian state gas monopoly Gazprom, aimed at giving the Russian company a major stake in the project.

As Ethical Corporation went to press, it was announced that Gazprom will pay Shell £3.8 million for a controlling stake in the project.

Other foreign investors are feeling the effects of the Sakhalin events. Peter Hambro Mining has seen its shares slump after Russia’s environment agency called for the withdrawal of the firm’s operating licences in the country. As a result, the company’s chairman has travelled to Russia for meetings with the deputy head of the Russian environment agency, Oleg Mitvol. and its sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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