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Bloomberg: Russia Receives Sakhalin Environmental Plan From Shell, Gazprom

By Lucian Kim

March 20 (Bloomberg) — Russia’s Natural Resources Ministry received a plan from Royal Dutch Shell Plc and OAO Gazprom to remedy environmental violations at their Sakhalin-2 venture.

Most of the measures to fix the problems will be realized by the end of next year, the ministry said in an e-mailed statement today.

Natural Resources Minister Yuriy Trutnev is satisfied that project operator Sakhalin Energy presented such a “concrete and complete” plan so quickly, according to the statement. The ministry will give its appraisal of the plan “within a month.”

The ministry uncovered a raft of environmental violations at Sakhalin-2 last year, just as Gazprom was negotiating with Shell and its Japanese partners to take a stake in the project. Shell ceded control of the development to Gazprom in December for $7.45 billion.

Once a final agreement is sealed this month, Shell’s holding will fall to 27.5 percent, with Mitsui & Co. retaining 12.5 percent and Mitsubishi Corp. 10 percent.

To contact the reporter on this story: Lucian Kim in Moscow at [email protected]
Last Updated: March 20, 2007 10:13 EDT

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