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Daily Telegraph: Russia puts off ruling on BP licence

Daily Telegraph photograph of Gazprom HQ Moscow

(The Gazprom building in Moscow: analysts still expect the company
to take control of the Kovykta field)

By Russell Hotten
Last Updated: 12:19am BST 02/06/2007

Russian regulators have delayed a decision on the fate of BP’s involvement in the massive Kovykta gas field until after next week’s G8 summit of rich countries.

The move may avoid a potentially embarrassing row over Moscow’s attempts to return its energy assets to state control.

But the regulator has revoked a licence allowing Sweden’s Lundin Petroleum to operate a field in the Caspian Sea, and given Britain’s Imperial Energy three months to correct alleged breaches of exploration and development obligations at three projects in Russia.

Yesterday, the licensing agency, Rosnedra, put back a decision on whether to withdraw TNK-BP’s rights to operate at Kovykta for about two weeks, blaming the “complexity of the matter”.

Analysts still expect Rosnedra to revoke or substantially alter the licence, opening the door for state-run Gazprom to take control of a field that contains enough gas to satisfy the world’s needs for one year.

Withdrawing the licence yesterday was likely to inflame Western concerns about the pressure Moscow is putting on companies investing in Russia’s energy sector ahead of the G8 meeting in Germany.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/06/02/cnbp02.xml

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