Gazprom Says That Kovykta Can't Wait

Gazprom warned Wednesday that its patience was running out in the talks to finalize the purchase of Kovykta from TNK-BP, saying the government could simply seize the license for the huge field from the besieged Russian-British venture.

"We can't wait forever," Gazprom deputy chief executive Alexander Medvedev said at a news conference. "We have received a signal from the Natural Resources Ministry. If things keep going the same way, they can return to the question of revoking the Kovykta license."

TNK-BP chief executive Robert Dudley said three weeks ago that he hoped the companies would conclude the long-delayed deal by the end of this month. Medvedev's remarks hinted that little, if any, progress had been made.

The Natural Resources Ministry confirmed that it was unhappy about the delay. "If the issue isn't resolved in the near future, the ministry will consider applying sanctions," ministry spokesman Nikolai Gudkov said.

Requests for comment from TNK-BP were not answered by press time, while a spokesman for BP in Moscow, Vladimir Buyanov, said BP wasn't involved in the Kovykta talks and referred questions to TNK-BP.

In June 2007, Gazprom agreed to buy a 63 percent stake in Rusia Petroleum, the company that holds the rights to develop Kovykta, at a price to be determined in the next 90 days, but that deadline has repeatedly been moved back.

Gazprom valued the stake at no more than $800 million, but Dudley said earlier this month that TNK-BP was seeking close to $1 billion.

Medvedev and Gudkov said Wednesday that Rusia Petroleum was still in breach of the license terms for the field. The Kovykta deal in June came as the government was closing in on revoking the license on the grounds that Rusia Petroleum had been unable to meet production targets.

TNK-BP said at the time that it would not have been able to sell that much gas locally. It bought the field in the hope of exporting gas to China, but a federal law later blocked that option.

Medvedev's comments came as TNK-BP confirmed new back tax charges Wednesday, the latest in a series of problems the company has faced.

Medvedev's other comments Wednesday were about a delay in the launch of Russia's first plant to liquefy natural gas, which is part of the Sakhalin-2 project. LNG deliveries will start early next year, he said. The previous plan was to send the first shipments in the third quarter of this year, he said.

A contract that Sakhalin Energy, the project operator, signed with Japan's Hiroshima Gas in 2006 envisioned that deliveries would start in summer of 2008, according to a statement posted on Sakhalin Energy's web site.

Medvedev didn't elaborate on the reasons for the delay. A spokeswoman for Gazprom Export said she had no further information.

Gazprom entered Sakhalin-2 as a majority owner last April. Maxim Shub, a spokesman for Shell in Russia, the project's second-largest shareholder, insisted that construction of the LNG plant was going according to schedule and would be commissioned by year's end.