March 01, 2007	Thursday	Safar 11, 1428

MOSCOW, Feb 28: The state-controlled Russian gas giant Gazprom is reported to have asked the European Bank for Reconstruction and Development for a loan of $300 million to refinance the giant gas project Sakhaline-2.

According to the Russian RBK Daily newspaper, Russian ministers disclosed the request to the Japanese ministry of commerce during an official visit to Tokyo. In January, the EBRD turned down an earlier request for a $400 million loan for the Sakhalin-2 liquified gas project in eastern Russia after Gazprom became a majority shareholder.

Anglo-Dutch oil and gas major Shell announced last December that Gazprom would acquire 50 per cent of the shares, plus one, in the Sakhalin-2 project at a cost of $7.45 billion.

The move made Shell and Japanese trading houses Mitsui and Mitsubishi Corporation minority partners in the energy project, which is based on an island off Russia's far eastern coast.

The sale followed Russian threats to halt the project, from which the government was unlikely to get revenue for many years due to cost overruns, over alleged environmental violations.

With the new shareholding arrangement, Sakhalin-2 no longer appeared to fit the category of projects usually financed by the EBRD, which since 1991 has helped former Soviet bloc countries make the transition to market economies.—AFP