Kremlin Imposes Control On Key Energy Project
Royal Dutch Shell has agreed, most say under Kremlin pressure, to relinquish control of a huge oil and natural gas project on Sakhalin Island. On "Power Lunch" – Sue Herera took a closer look at what's happening - and what it means to the energy sector going forward.
Andrew Neff, Senior Energy Analyst with Global Insight said, "What we're seeing is Russia beginning to project it's influence on the world stage as an energy super-power. And we're probably going to see more influence from the government on some other projects. (Going forward) Russia will be reclaiming it's seat in world politics - using energy as a catalyst.
Denis Maslov, Europe and Eurasia Analyst at The Eurasia Group added that the Sakhalin Islands are the largest liquefied natural gas project in Russia. He said, "It's a strategic location. It's very close to Japan as well as China which is a market Russia wants to develop." (which is why the Kremlin would want control)
"(Next year) we will see more projects under pressure. Russia will continue to use energy in its negotiations and will try to raise prices to many countries on its borders, in a push to increase revenue and exert political influence.
Russian President Vladimir Putin has said its in his country's best interests to consolidate control of his country's natural resources.