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Russian regulators threaten country's top oil firm
By Stephen Boykewich
AFP
MOSCOW
Petroleumworld.com 10 15 06
Russian environmental regulators announced a crackdown Friday on Lukoil, the country's biggest oil firm, following pressure on foreign energy companies in Russia that provoked international objections about unfair treatment.
The environmental resources ministry said it may strip 20 licenses from the privately owned Lukoil, following weeks of mounting pressure on foreign energy companies in Russia.
The ministry "has decided that it is necessary to remove the licenses for research and extraction at 11 licensed plots" in the Komi province in the northern part of the Ural mountains region, the ministry said in a statement.
Eight other licenses may be stripped from a Lukoil subsidiary in the neighboring Khanty-Mansysk region, plus one more from a subsidiary in Komi, the ministry said in separate statements.
The decisions came after inspections carried out by Oleg Mitvol, the campaigning deputy head of the ministry's natural resources agency, with the help of environmental defense organization Greenpeace.
Mitvol led a recent campaign against a consortium headed by British group Shell for alleged environmental violations at Sakhalin-2, a 20-billion-dollar (15.8-billion-euro) oil and gas project off Russia's Pacific coast.
That campaign, together with mounting regulatory pressure on other foreign energy companies, provoked an outcry from foreign officials and was interpreted by analysts as a push for increased Russian control of the projects.
Mitvol and other Russian officials forcefully rejected the claims, saying their moves were in line with the assessments of international ecological groups such as Greenpeace.
"If you think that this only concerns foreign companies, just wait," Mitvol said in a press conference last month.
A ministry spokesman told AFP that Lukoil and its subsidiaries had been given a list of violations to be rectified within three to six months for each of the licenses in question.
If the violations are not rectified in time, the license removals will be permanent, the spokesman said.
"The basis for the decision is violations of licensing agreements and the law 'On Subsoil Resources' in the allotted time for carrying out geological surveys and drilling work, as well as bringing the fields online, by the company Lukoil," the ministry said.
Lukoil said in a statement: "The company will make every effort... to rectify violations within the designated time."
Greenpeace energy campaign director Vladimir Chuprov said that the ministry's inspection commission, which Mitvol headed, "came to us asking for help."
"We provided the information we had about the environmental situation in the region and conducted parallel inspections alongside the official commission," Chuprov told AFP.
Mitvol said in a statement that among Lukoil's environmental violations was unauthorized logging and "the erection of oil derricks on federal forest reserves" in Komi.
The natural resources ministry's sudden co-operation with environmental organizations in its crackdown on Sakhalin-2, led environmental activists to ask why their cries had not been heeded in previous years.
UBS Warburg oil and gas analyst Kakha Kiknavelidze said the cooperation of Greenpeace and the ministry, which have often been at odds in the past, was a sign of "changing times."
He also said he doubted that the threats to Lukoil's licenses were a sign of "serious trouble" for the company.
"I wouldn't rule out that Lukoil simply lost interest in some of these fields and decided not to develop them," he said.
Alfa Bank oil and gas analyst Andrei Fyodorov concurred, adding that Lukoil had known little about the plots when it received the licenses.
"Lukoil is a fairly strong company and should be able to deal with these problems in three to six months," Fyodorov said.
The ministry said it had revoked more than 80 licenses related to subsoil use so far this year.
AFP 13 1531 GMT 10 06
Copyright ©2006 AFP. All Rights Reserved.
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