The Russian government is threatening to cancel oil and gas exploration licenses it granted to Royal Dutch/Shell, ExxonMobil and Total.

On Saturday, Sept. 16, Russia’s Prosecutor-General charged that a key environmental permit for Shell’s project, which covers the $20 billion Sakhalin-2 development, does not comply with Russian law. The Prosecutor’s statement could strengthen the hand of Russia’s environmental watchdog, Rosprirodnadzor, as it attempts to halt work on the project, alleging abuses of environmental laws.


The projects run by Shell and ExxonMobil are production sharing agreements (PSA), which cover the development of offshore oil and gas fields at the Sakhalin Island, in Russia’s Far East. Total was granted a license to develop a large northern Kharyaginsk oil field.

“At the present time, not one technical project has been carried out at any of the three Russian PSAs,” which is one of two terms under which the agreements can be cancelled,“ Interfax quoted Natural Resources Ministry’s director of government policy Sergei Fyodorov as saying.