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    Mineral resource agency to consider Kharyaga license situation

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    MOSCOW, December 21 (RIA Novosti) - Russia's mineral resources agency is expected to consider Friday the early withdrawal of a license from the northeast Russian Kharyaga oil field operated by French oil major Total, a deputy agency head said Thursday.

    Earlier, Russia's environmental watchdog said it uncovered several violations of environmental laws during the development of the deposit under a production-sharing agreement (PSA).

    Pyotr Sadovnik said: "Since the deposit is a subject to a production-sharing agreement, then only one of the parties to the PSA has the right for an early license revocation. It means that the government should first of all cancel a contract [PSA] and only then make a decision."

    Total has been developing the Kharyaga deposit under a production-sharing agreement signed in 1995 that came into force January 1, 1999. Total owns a 50% stake in the project, alongside Norway's Hydro (40%) and Russia's Nenets Oil Company (10%).

    Sadovnik said that after the mineral resources agency completes discussing Friday the license revocation it will send its materials to the Industry and Energy Ministry.

    The Russian environmental watchdog revealed earlier that the operator failed to follow the recommendations of the central commission on the field's development, and in particular failed to observe the gas drive recovery process, burning up 60% of the natural gas produced in 2005.

    Also in April, the Natural Resources Ministry accused Total of failing to meet its targets for Kharyaga under a 1995 production-sharing agreement.

    It said the investor failed to increase production of crude and introduce new technologies and equipment for effective production since the agreement came into force in 1999.

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