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Russia to keep Sakhalin-3 oil block for own firms

Russia will auction off oil and gas blocks of the Sakhalin-3 project as strategic deposits, Resources Minister Yuri Trutnev said on Monday, signalling that foreign access to the project will be limited.

"Sakhalin-3 should be part of strategic (fields)," he told a news conference.

U.S. oil major Exxon Mobil has long hoped to revive its involvement in Sakhalin-3 that Russia cancelled a few years ago, saying the company's agreement to develop the large block was never finalised.

The move came along with other steps by the government to increase Russian control in the strategic energy sector.

Last year Russia's gas export monopoly Gazprom took over control in the neighbouring Sakhalin-2 project from Royal Dutch Shell following months of pressure from the state ecological agency.

Russia has yet to approve a law on strategic deposits, which has been delayed due to disagreements between key ministries.

Trutnev has said that despite disagreements Russia is still planning to cap foreign involvement in fields with more than 70 million tonnes of oil and 50 billion cubic metres of gas reserves.

Trutnev has also proposed to demand oil and gas firms build large refining complexes when tapping big fields to spur economic development in regions where these fields are located.

On Monday, he said the state might identify six deposits, for which special investment will be needed, but did not name them. He said Sakhalin-3 and the giant copper Udokan deposit could require building large refining complexes.

He also said oil and gas firms were under-investing in exploration in East Siberia and the Far East and added he would present the government with a new programme this year, which would guarantee bigger reserves replacement.

© Reuters

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