Threat to BP’s Siberian gas field

BP’s Russian unit, TNK-BP, may have to halt production at a large Siberian gas field by the end of this month, Russia’s environment agency has warned.

The agency told Reuters it seemed “obvious” that an inspection in the next few days would say TNK-BP was not complying with production obligations.
Russian authorities claim TNK-BP is not producing enough gas from the Kovykta field.

They say that under the licence terms, Kovykta should have been producing nine billion cubic metres of gas per year by 2006, rather than the less than 2.5 billion cubic metres actually being processed.

TNK-BP has repeatedly countered that it currently cannot produce any more as the local region does not require additional supplies, and that a plan to build a pipeline to China was blocked by Moscow.

The firm, which is equally owned by BP and Russian group Alfa Access Renova, earlier this month won the right to challenge in court the threat to its Kovykta licence.

Yet the deputy head of the Russian environment agency, Oleg Mitvol, said he was not concerned by the possible legal challenge.

BBC