THE WALL STREET JOURNAL/DOW JONES NEWSWIRES: Russian PM To Talk To Shell About Shtokmanov – Interfax (ShellNews.net)

DOW JONES NEWSWIRES

September 29, 2004 2:35 a.m.

MOSCOW -- Russian Prime Minister Mikhail Fradkov said Tuesday that he will talk to representatives of Royal Dutch/Shell (RD) about the possibility of its investing in the Barents sea gas field Shtokmanov, the news agency Interfax reported Wednesday.

"We will talk to Shell about the possibility of them increasing their presence in Russian assets. We will discuss the possibility of the company increasing its involvement in the Shtokmanov and Sakhalin projects," the agency quoted Fradkov as saying on arrival in the Netherlands for an official visit.

"They might be interested in the initiative to enlarge (Russian gas monopoly OAO) Gazprom (GSPBEX.RS) and form a new company," Fradkov told reporters.

All of this is up for discussion, Fradkov said. "We are ready for cooperation."

Shell and Gazprom are currently negotiating the terms of Gazprom's entry into the Sakhalin-2 project led by the Anglo-Dutch company. Shell has also long wanted to invest in Gazprom's giant Zapolyarnoye field in northern Russia, and analysts believe the two may swap assets in the respective projects.

Shell hasn't recently been prominent in talks to develop Shtokmanov. However, Gazprom has intensified its search for partners for the project in the last few months, signing preliminary memoranda of understanding with Norway's Statoil ASA (STO) and ChevronTexaco Inc (CVX).

Agency web site: http://www.interfax.ru

-By Geoffrey T. Smith, Dow Jones Newswires (+7 095 974 8055); geoffrey.smith@dowjones.com