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energycurrent.com: RBS urged to pull Gazprom’s Sakhalin II loan

Filed from Aberdeen
1/30/2008 6:12:18 PM GMT
 
RUSSIA: Nineteen local and international environmental organizations have called on Sir Fred Goodwin, CEO of Royal Bank of Scotland (RBS), to recall a controversial US$1 billion loan by ABN AMRO for the Russian energy giant Gazprom’s purchase of a controlling share of the enormous Sakhalin II oil and gas project in Russia.

Sakhalin II has caused many severe environmental problems and violates the Equator Principles, to which RBS has signed, claim the Pacific Environment organisation. The groups have also requested to meet with Goodwin. RBS leads a consortium of banks that purchased ABN AMRO in 2007.

Environmental groups claim they have opposed ABN AMRO financing for Sakhalin II because the project threatens the Western Gray Whale with extinction, damages hundreds of wild salmon runs, and negatively impacts local communities.

“When RBS bought ABN AMRO, it acquired the bank’s assets and liabilities, including financial and reputational, and thus the responsibility to address the wrongful financing of Sakhalin II,” said Dmitry Lisitsyn, chairman, Sakhalin Environment Watch.

Environmental groups and independent consultants of potential lenders, including the European Bank for Reconstruction and Development (EBRD) have for many years documented Sakhalin II’s severe, chronic and irreversible violations of bank environmental policies.

For private banks, this includes the Equator Principles on environmental performance, which both RBS and ABN AMRO have committed to follow.  EBRD eventually withdrew its consideration of Sakhalin II while many other banks suspended consideration of the project due to environmental problems.

“At the 2005 ABN AMRO Annual Meeting, Chief Executive Officer Rijkman Groenink committed to not finance Sakhalin II until it was brought into compliance with the Equator Principles,” said Paul de Clerck of Friends of the Earth International, who was at the 2005 ABN AMRO Annual Meeting where the commitment was made.

“So, it came as a complete shock when the bank circumvented the Principles by financing Sakhalin II through one of the project sponsors.  RBS must now take responsibility to correct this damage.”

“The buck now stops at RBS,” said Doug Norlen, policy director, Pacific Environment.

http://www.energycurrent.com/index.php?id=2&storyid=8499

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