Dec 10, 2006

Putin Hints at a Shtokman Reversal

President Vladimir Putin and two senior state officials reopened the possibility of foreign energy majors taking part in the Shtokman gas project, signaling that Gazprom might soon reverse its decision to bar them from developing the giant Arctic field, reports The Moscow Times.

Gazprom's announcement in early October that it had rejected all five foreign bidders for Shtokman prompted widespread shock and skepticism in the global oil and gas industry. Many doubted Gazprom was capable of developing the huge gas field, its first offshore, on its own.

In separate statements, Putin and Industry and Energy Minister Viktor Khristenko reiterated Gazprom's argument that the equity swaps offered by the five short-listed companies -- U.S. oil majors ConocoPhillips and Chevron, France's Total, and Norway's Statoil and Norsk Hydro -- were inadequate.

Putin's recent comments prompted speculation that the selection of foreign partners for Shtokman could, after all, have been linked to negotiations with the United States on Russia's entry to the World Trade Organization. Spokespeople for the Kremlin have previously denied the existence of a direct link between the two issues.

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