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Russian Government: Sakhalin Subcontractors Broke Logging Laws

A spokesman for Sakhalin Energy said he could not immediately comment because he hadn't yet studied the statement by the environmental agency, Rosprirodnadzor. But he said that construction on the two pipelines - one for crude oil and one for natural gas - had been brought to a halt at Sakhalin Energy's own initiative.

The deputy head of Rosprirodnadzor, Oleg Mitvol, said he plans to refer the case to Russia's General Prosecutor's office with a request that a criminal case be opened against the subcontractor for illegal logging, the statement said.

The Sakhalin Energy consortium, developing the Sakhalin-2 project, is majority owned by Shell, while a subsidiary of Japan's Mitsui & Co. Ltd. holds a 25% stake and Diamond Gas Sakhalin, a subsidiary of Japan's Mitsubishi Corp., holds 20%.

The agency also said that work on the pipelines could only be resumed following official approval of the work plan.

© Dow Jones Newswires

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