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Last Updated: Friday, 26 May 2006, 05:19 GMT 06:19 UK
Russia looks at oil control move
Oil facility in Siberia
Russia has substantial oil and gas reserves
Russia is floating the idea of taking majority control of three oil projects in Siberia owned by Western firms Shell, ExxonMobil and Total.

The Resources Ministry says it is studying a plan to take a 51% stake in the projects, fanning fears the Kremlin is ignoring Western business interests.

The proposal has been put forward by Russia's Academy of Natural Science.

In 2004, Moscow effectively renationalised then-oil giant Yukos after a forced auction of its assets.

'Common sense'

In its report, the Academy recommends that the state takes majority control of Shell's Sakhalin-2 field, Exxon's Sakhalin-1 and the Kharyaga licence held by Total, because it says they are all behind schedule, over budget and short on Russian involvement.

"The Russian Environmental Agency and the Natural Resources Ministry plan to use the Academy's information in future application of control over developing these deposits," said the Resources Ministry.

"This is not the ministry's official position, but there is common sense in what scientists are saying."

The re-nationalisation of Yukos' assets came after Moscow hit the firm with giant back tax demands.

Russian authorities subsequently jailed former Yukos boss Mikhail Khodorkovsky for nine years on six changes including tax evasion.

Many Western commentators said Mr Khodorkovsky - Russia's richest man at the time - was punished for seeking to bankroll pro-Western parties.

More recently, Moscow has been criticised for its role in a gas dispute with neighbour Ukraine.

State-run Russian gas giant Gazprom cut production to the Ukraine in January, causing a knock-on shortage in Western Europe.

While Moscow insisted it was simply a dispute over payments, Western commentators accused Russia of using gas as a political tool.


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23 May 06 |  Business


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