Total operates sites II and III at the deposit in the Siberian Yamal-Nenets Autonomous Area in northwest Siberia through its Russian arm, Total Razvedka Razrabotka Russia.
"There remain substantial discrepancies between the underlying project documents for developing the Kharyaginsk deposit, and the actual activities of Total Razvedka Razrabotka Russia," the ministry said.
The company has not been using water to replace extracted oil and maintain pressure at site III, and at site II has only done this to 30% of the necessary level, the ministry said. It added that Total is producing oil at an efficiency level of under 70%, causing a shortfall of 20-30% against the program agreed with state oil-pipeline company Transneft for crude transit.
The company also plans to burn off 70% of the excess natural gas from the field, instead of pumping it back into the deposit or finding an alternative use for it, which will cause substantial pollution, the ministry said.
A production sharing agreement on the Kharyaginsk deposit between the Russian government, the local administration, and Total's Russian arm, was signed in 1995, and came into force on January 1, 1999, for a term of 20 years.
Project participants are Total (50%), Norwegian company Hydro (40%), and Russia's Nenets Oil Company (10%).
Sites II and III pose major engineering difficulties for many reasons, including the high freezing point of the oil and the high levels of hydrogen sulphide and associated gas.
The project has so far received investment of $450 million, with another $800 mln expected for the next phase.
Total, headquartered in Paris, is the fourth largest oil and gas company in the world, with operations in more than 130 countries and average daily production of liquids and natural gas at around 2.6 million barrels of oil equivalent. As well its upstream operations, the company is also involved in refining, marketing, international trading and shipping of oil products.
