Gazprom 'wins $22B Shell gas plan' (Shell caves to the Kremlin)

[Barrett808]

MOSCOW, Russia (Reuters) -- Royal Dutch Shell has offered to cede control of the $22 billion Sakhalin-2 project, Russia's biggest single foreign investment, to state gas monopoly Gazprom after months of government pressure, industry sources said.

Such a deal would appear to mark a victory for the Kremlin, determined to wrest control over the "commanding heights" of the Russian economy, and a retreat by Shell.

Agreement in principle was reached at talks last week for Shell to reduce its 55 percent holding to a blocking stake of at least one-quarter in the world's largest liquefied natural gas (LNG) project, the sources told Reuters.

Both companies confirmed Shell Chief Executive Jeroen van der Veer had met Gazprom head Alexei Miller in Moscow on Friday, but declined to go into detail on their talks.

"I can confirm that Shell Chief Executive Jeroen van der Veer met Gazprom head Alexei Miller and Energy Minister Viktor Khristenko in Moscow on Friday to discuss Sakhalin-2-related issues," a Shell spokesman told Reuters on Monday.

"The discussions were positive but their contents remain confidential."

(more)

http://www.cnn.com/2006/BUSINESS/12/11/shell.gazprom.reut/index.html

[Psephos]

1. Old Europe has itself a new master

Russia supplies a third of European gas already...on its way to half within a decade.

I predict we'll see a lot of looking the other way when Russia behaves badly.

Peace.

[1932]

3. What's bad about this?

[Psephos]

4. You forgot to add the sarcasm smilie to your post. n/t

[1932]

5. I'm serious.

What do you think is bad about countries renegotiating contracts that were more advantageous for Shell executives and shareholders than they are for the citizens of the countries whose natural resources they're exploiting>

[Mojorabbit]

6. This is totally not capitalistic

but I wish we were being better stewards of the oil we have left in this country. It is running out all over the world. It seems to me that we should be looking to the future and conserving what we are bringing up out of the ground for the future instead of pumping at full speed and selling it all as fast as we can. A little nationalizing might be the smart thing to do.

A plan such as... we will only pump x amt while conservation measures are put in place and parcel it out carefully till we can come up with long term replacements for oil.I don't know how that would affect the world situation in the short term as I am not totally aware of all the intricacies but sheesh is there any planning for the future being done.

[Henny Penny]

9. I for one am delighted to see Shell getting a bloody nose...

They certainly deserve it!

[Printer70]

2. Pressure; but now you know why Bush

...suddenly turned on Putin. We all heard about the poisonings, but let's not be mistaken: there are countless dictators, including those in China, that have done far worse. Russia's re-asserting its rights over its own natural resources, such as oil, appears to be the source of real tension. The "human rights" abuses are usually the cover for fundamental disagreements between nation states. Shell and Exxon essentially control the oil trade.

I expect Bush or the administration to come out strongly against Russia in the next 3-4 weeks.

[MattSh]

7. Besides,

Putin proposed creation of ruble-denominated oil, gas exchange. Bush's friend Saddam became his enemy when he dumped the dollar. Vladimir the Good became Vladimir the Evil when he proposed dumping the dollar. What's next? Maybe Bush won't learn from both Napolean and Hitler and will try to march on Moscow?

In case you missed it.....

http://en.rian.ru/russia/20060510/47915635.html

[Printer70]

10. Interesting

Yeah, there always is a back-story and then human rights is always the public rationale for the confrontation or war.

[Eugene]

8. Reuters: Shell says has not surrendered on Sakhalin-2

Shell says has not surrendered on Sakhalin-2
12 Dec 2006 13:44:42 GMT
Source: Reuters

MOSCOW, Dec 12 (Reuters) - Royal Dutch Shell <RDSa.L> said on Tuesday
that it had not surrendered its Sakhalin-2 oil and gas project to Russian
gas firm Gazprom <GAZP.MM>, responding to a Reuters report that it had
agreed to cede control.

"There's been a lot of reporting that we've thrown in the white flag.
The negotiations have not been concluded, contrary to what's been said.
There are a number of options that are being considered," Shell spokesman
Alf D'Souza told Reuters.

"There's no doubt that the eyes of the world are on this foreign investment,
the largest in Russia. Shell and its fellow investors expect to be treated
equitably."

-snip-

Full article: http://www.alertnet.org/thenews/newsdesk/L12904512.htm