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Daily Telegraph: Russia to review gas field licences

By Russell Hotten
Last Updated: 12:44am GMT 30/01/2007

Russia’s official environment agency is to review the operation of licences that allow TNK-BP to develop the giant Kovykta gas field, where Gazprom, the state-run energy company, is negotiating to become a partner.

Although the agency has not made recommendations about withdrawing the licences, the issue has echoes of the environmental crackdown on Shell over its Sakhalin-2 development.

Gazprom and Russian authorities have withheld approval of plans to build a gas pipeline from Kovykta to China, a move felt necessary to make development of the field economically viable.

Last year the agency, Rosprirodnadzor, put huge pressure on Shell and its Sakhalin partners over alleged environmental violations and threatened to withdraw licences. The move was widely interpreted as an attempt to strong-arm Shell into relinquishing control of Sakhalin-2 to Gazprom on favourable terms, something denied by the authorities. But Moscow wants to regain control of its energy assets, many of which were sold off to western companies in the early 1990s.

Environment agency inspectors said they expected to report on the findings of any Kovykta violations in April. The field holds 2,000bn cu metres of gas, and is one of the “crown jewels” that will turn Russia into an energy superpower.

TNK-BP is 50-50 joint venture between BP and Russia’s Alfa Access Renova. Together they own about 63pc of the company, Rusia Petroleum, developing Kovykta. Russian media has said that Gazprom wants a stake of about 74pc in Rusia. TNK-BP was not available for comment last night.

Meanwhile, Indian wind turbine maker Suzlon Energy has received a $56.4m (£28m) order from BP for 32 turbines, with a total capacity of 40megawatts, for a project in Maharashtra, western India.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/01/30/cnbp30.xml

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