"The Federal Service for the Oversight of Natural Resources says that since the [production-sharing] agreement came into force, the investor has failed to fulfill its main aims of increasing production of crude and introducing new technologies and equipment to provide for effective oil and gas production," the statement said.
Total was developing the Kharyaga deposit under a production-sharing agreement signed in 1995 that came into force on January 1, 1999.
Total owns a 50% stake in the project, alongside Norway's Hydro (40%) and Russia's Nenets Oil Company (10%).
The ministry said Total's pre-planned oil production for 2006 was over two thirds less than the projected level for the deposit.
"It was planned to drill only 12 instead of 34 production wells, three instead of 25 intake wells, and with water input level four times lower than the projected figures," the statement said.
Natural Resources Minister Yury Trutnev sent a letter to Industry and Energy Minister Viktor Khristenko, who oversees the implementation of the Kharyaga production-sharing agreement. The letter documents violations of the agreement by Total and non-compliance with the projected tasks for the development of the deposit.
