Forbes/AFX News Limited: Shell says Sakhalin project wins favourable review from EBRD: “In a statement, Shell said EBRD found the project's approach to environmental and social issues management 'fit for purpose' following a three-year assessment.”: Wednesday 14 December 2005

LONDON (AFX) - Royal Dutch Shell PLC said the European Bank for Reconstruction and Development gave a favourable review on the 20 bln usd Sakhalin-2 project in Russia.

EBRD is one of the prospective financiers of the controversial Russian gas project.

In a statement, Shell said EBRD found the project's approach to environmental and social issues management 'fit for purpose' following a three-year assessment.

'The lenders' assessment has been very thorough and they provide an important independent perspective and challenge. We look forward to strengthening our relationship with the lenders as the development progresses,' said Ian Craig, chief executive of Sakhalin Energy, owned by a consortium led by Shell.

Sakhalin-2 has suffered cost overruns partly due to volatile currencies, doubling the cost of the project to 20 bln usd and delaying its start up to 2008 from 2007.

Environmental protests marred the development of the gas field, fueling fears that the EBRD and other key lenders may withhold funding.

mbe/lam

Click here to return to ShellNews.net HOME PAGE