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BankWatch.Org: Sakhalin II pipeline construction suspended again by authorities, catalogue of violations mounting

For immediate release: July 26, 2007

Sakhalin Island, Russia — The construction of the Sakhalin II onshore pipelines was suspended today by the Russian state agency responsible for industrial safety and environment protection –   Rostekhnadzor – because of violations during the pipeline construction through an active seismic fault in the Tymovskiy district in the central part of Sakhalin Island. [1]

Rostekhnadzor stated that the project operator, Sakhalin Energy Investment Company (SEIC),  has digressed from project decisions on the construction of drainage systems on active seismic faults and has used pipes which were not planned by the project. The suspension will remain in force until SEIC properly addresses the violations during the drainage system construction.

Dimitry Lisitsyn, Chairman of Sakhalin Environment Watch, said: “Gazprom may now be the majority shareholder of SEIC, but Shell is continuing to manage the project’s construction and is simply continuing the usual violations of Russian legislation and their own committments. As Shell demonstrates their standard failure to properly manage the pipeline cosntruction, Gazprom stands aside and waits for Shell to finalise the construction. But it’s clear that Shell is doing the project not for themselves, but for somebody else, so the cutting of corners is inevitable.

“The pipeline completion is scheduled for October this year but seismic fault crossings are still at a very early stage. SEIC still doesn’t have official land use agreements for the majority of these crossings.”

Today’s suspension comes as fresh revelations have surfaced about the Sakhalin II onshore pipeline’s violations of Russian law, with the issuing earlier this month of two warning letters from the Natural Resources Committee of Sakhalin Regional Administration to two Russian federal agencies. [2]

Based on a review of the project’s fulfillment of nature conservation legislation requirements, carried out by Sakhalin Regional Administration in the Makarov Territory and Dolinsky District of Sakhalin Island since May 21, 2007, the two federal agencies – Rosprirodnadzor and Rostekhnadzor [3] – received details of a number of violations that threaten oil spills when the pipeline becomes operational.

The Natural Resources Committee of Sakhalin Regional Administration explicitly calls on the federal agencies to conduct a new “urgent”
inspection of the pipeline route in order to directly address the sub-standard construction methods being used by SEIC.

Dimitry Lisitsyn said: “This latest evidence of grievous failings on the part of SEIC adds to what we and recently the Russian Academy of Sciences have been picking up along the pipeline route. As things stand now, oil spills are inevitable so we call on the federal bodies to act on the advice of  Sakhalin Regional Administration and for Rosprirodnadzor in particular to be as robust now as it was last autumn in its involvement in the project.
Despite all the fuss last year, and the resultant new Gazprom ownership, the same serious problems keep cropping up.”

The letters from the Natural Resources Committee of Sakhalin Regional Administration detail: “Sags in the pipeline, and changes in hydro-geological, frost penetration and ground stability conditions”; that “ the pipes are coming to the surface”; the disposal of waste soil along the pipeline’s path which is promoting “the  formation of landslides and mudflows” and; that  “protective engineering structures on the inspected sections of the route were absent”.

The overall prognosis for SEIC is extremely concerning, with one of the letters citing: “the extremely unsatisfactory protection of waterways from the penetration of waste construction soil.  The selective installation of anti-fishing screens, their unsatisfactory upkeep where they are established, the work of construction equipment on the flood plain, landslides from slopes, and dumped waste construction soil, all require competent assessment and urgent intervention.”

For more information, contact:

Dmitry Lisitsyn
Sakhalin Environment Watch
Tel: +7 914 757 0076
Email: sakhalinwatch at

Petr Hlobil
CEE Bankwatch Network, Prague, Czech Republic
Tel: +420 603 154349
Email: petrh at

Paul de Clerck
Coordinator of corporate campaign
Friends of the Earth International
Tel: +32 494380959
Email: paul at

Notes for editors:

1. Media report (in Russian) available at:

2. The two letters (translated in English) can be seen at:

3. Rosprirodnadzor is the Russian Federal Service for Supervision of Natural Resource Usage; Rostekhnadzor is the Russian Federal Service for Ecological, Technical and Atomic Supervision and its sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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