RusEnergy

05.13.2005 - Kommersant -The Minister of Natural Resources (MNR) Yuri Trutnev announced yesterday that his ministry "plans to use forceful measures in situation around Kovykta." Also yesterday, the representative of MNR told Kommersant, that by the middle of the summer the ministry will finish the audit of Rusia Petrolium responsible for extracting the natural gas from Kovykta deposit. The result of this audit can become the revocation of the company license to exploit the Kovykta deposit. The Kovykta deposit (Irkutsk region) is the largest untouched condensed natural gas deposit in Russia. According to the geologist estimate, the Kovykta contains about 2 trillion cubic meters of natural gas. The Rusia Petrolium (subsidiary of TNK-BP, which owns 62, 89 percent of the company stock) has a license to exploit the deposit. The license agreement says that starting from 2006 the company should provide 9 billion sq.m of the gas from the deposit to the market of Irkutsk region. However, Rusia Petrolium did not even start yet the extraction of the gas. The company explains the delay by absence of the transport infrastructure which is necessary for the gas distribution from the Kovykta deposit. TNK-BP for several years now tries to negotiate with Gazprom a possibility to export the gas from Kovykta. The company even invited Gazprom to participate. However, these negations did not produce any positive results. In last June the MNR commission demanded from Rusia Petrolium to follow the license agreement about the agreed time frame of the gas production start. The MNR representative told Kommersant, that in December Rusia Petrolium presented the project of changes in the license agreement. "They, for instance, offered to postpone the beginning of the deposit exploitation for five years. The Ministry examined these proposals and left unsatisfied with them," the source told to Kommersant. He also mentioned that the ministry in the nearest time will start checking if Rusia Petrolium made any attempt to correct its disregard to the license agreement. The ministry official also said that in the middle of Summer there will be a commission created to supervise for proper use of natural resources. This commission might adopt the decision to revoke the Kovykta license. Another source inside of the ministry thinks there are good 75 percent that Rusia Petrolium will lose the Kovykta license. "The political decision about the license revocation is already practically made," the source said. Trutnev confirms this opinion by saying "the government cannot wait forever while TNK-BP will reach the agreement with Gazprom." "When they were getting the license, they had to think than what to do with the infrastructure," Trutnev announced. Then he added that this approach should be applied for Gazprom as well, because the concern is late with exploitation of several deposits. The MNR representative explained that the Minister meant new natural gas deposits in Yamal. The TNK-BP representatives refused to comment problems surrounding the Kovykta. Kommersant will follow further events. Rusia Petrolium will not share revenue with stockholders The TNK-BP affiliates such as Rusia Petrolium, East-Siberian Gas Company (ESGC) and Verkhnechonskneftegaz are not going to pay out the dividends for 2004. Director General of ESGC Alexander Sobol' told this information to the news agency Interfax . He explained that all earned cash will be spent for the deposit exploitation and preparation to build the pipeline. The annual stockholder meetings will be conducted for ESGC and Verkhnechonskneftegaz on June 29. The stockholders of Rusia Petrolium will gather on June 28.