Shell and its partners put a brave face on a final deal signed yesterday to hand over a 50% stake in Sakhalin-2 - the world's largest oil and gas export project - to Russia's state-owned gas company Gazprom.
They said the „uncertainty is over” and the deal should offer „growth opportunities”. The $7.5 billion (£3.7 billion) sale coincided with an agreement that alleged environmental violations raised by the Kremlin could be sorted out at no extra cost and with no delay to the wider project in a move that will be seen by critics as evidence the charges were trumped up to put pressure on Shell to sell its stake. The European Union and others who have expressed concern will also note that a doubling of the Sakhalin-2 budget to $20 billion - previously dismissed as unacceptable by the Russian government - has also been agreed by Gazprom.
The Sakhalin-2 equity handover also coincided with a new attack by the Russian environmental competition office, Rosprirodnadzor, on other London-listed oil companies. Imperial Energy saw its shares slump 18% after the office's deputy head, Oleg Mitvol, said it should lose its west Siberian operating license because „the company is not interested in exploration”. Another London-listed company, Victoria Oil & Gas, is also being investigated in a rerun of the kind of problems that hit Shell and its partners, Mitsui and Mitsubishi. But yesterday there were only positive words from Gazprom and Shell over their deal.
Alexander Medvedev, Gazprom's deputy chairman, said: „Gazprom's entry into Sakhalin-2 is a powerful impetus for implementation of this large-scale development in the area of energy export to Asia-Pacific and North America. In turn, it will facilitate the company's strategy of phased entry into the global LNG market.” A Shell spokeswoman said: „The uncertainty is over and we have a major stake in the world's largest oil and gas export project with strong partners.” (guardian.co.uk)