Russia Oilmin asks US to drop energy supply barriers

MOSCOW, Mar 14 (Reuters) The United States, the world's top energy consumer, is asking producing countries to ramp up supplies but must drop its own market barriers if it wants them to deliver, Russia's top energy official said today.

Energy and Industry Minister Viktor Khristenko said the United States had to make it easier for producers to meet its needs. He referred specifically to problems facing planned deliveries of liquefied natural gas (LNG) to the United States.

Khristenko said Russia was running up against regulatory barriers for regasification projects just as the flow of gas earmarked for delivery to the US LNG market is increasing.

''If I say that it's difficult (to obtain permission for regasification), it would be extremely diplomatic. It is practically impossible,'' he told a news conference.

''This is how legislation in the United States works... And I think it poses a problem for such a booming market when on the one hand we are told ''give us more gas'' while on the other we are facing restrictions on this market.'' Russia is due to host a meeting on Thursday of energy ministers from the Group of Eight -- the United States, Japan, Germany, Britain, France, Italy, Canada and Russia.

Russian state gas giant Gazprom is developing the giant Shtokman Arctic gas field with plans to ship the output to the United States as LNG over 50 years.

It is negotiating with oil majors on joint regasification in the United States but Gazprom officials have hinted they would like to control the whole chain, from extraction deep under the Barents Sea to consumer sales in the United States.

Repeated attempts by Gazprom, holder of the world's largest gas reserves, to reach end users in Europe with pipeline gas have also been hampered by political and administrative hurdles.

''For Europe, demand management is one of the key tasks. The United States prefers to focus on the increase of supply,'' Khristenko said.

''But all attempts to publicly discuss it by saying... demand should be managed properly are unlikely to lead to success,'' he added.

''This is why the world needs greater transparency of reserves disclosure but also of greater transparency in demand management such as developments of oil and gas processing capacities.'' Russia, the world's largest gas exporter and second largest exporter of crude oil, is still under fire after gas supply cuts to Europe during the winter's fiercest cold snap, which coincided with a price row with transit country Ukraine.

Russia is using the run-up to the G8 energy meeting to mend its reputation and fight back, arguing suppliers need the promise of healthy returns to keep pumping oil and gas.

Reuters PG VP2358