Gazprom expansion causing Russia-Britain diplomatic row: Sergei

Moscow, July 26 (UNI) The chairman of the Russian Audit Chamber Sergei Stepashin said here that energy giant Gazprom's new role in the Sakhalin II project in Russia's Far East might be the cause for worsening diplomatic row between Russia and Britain over Moscow's refusal to extradite businessman Andrei Lugovoi in the murder of former KGB agent Alexander Litvinenko. .

"Gazprom joined the project, and this may not have pleased everyone. This must have been a factor in the harsh reaction to the extradition from our British partners," Stepashin, a former Prime Minister under late President BorisYeltisn, told RIA Novosti news agency.

Gazprom bought a controlling stake in the vast oil and gas project late last year from Anglo-Dutch oil major Shell at a lowball price following pressure from regulators.

The state-controlled oil major has continued to rapidly expand its sphere of operations in Russia, and last month closed a deal to buy a 62.9 percent stake in Siberia's vast Kovytka gas field from British oil major BP, also for a reportedly knock-down price, in a deal reminiscent of the Sakhalin purchase.

While British oil interests have been suffering in Russia, France's Total has received more favorable treatment, being picked earlier this month as Gazprom's partner to develop the huge Arctic Shtokman project in the Barents Sea.

The French oil major also had its 12 per cent cost estimate rise approved for the Kharyaga oil field it is developing in northwest Siberia.

UNI