SAN FRANCISCO - April 6 - News reports suggest that Shell Oils troubled Sakhalin II project in the Russian Far East is $2 billion over budget for a variety of reasons, including increased costs of off-shore platforms. There are believed to be problems associated with pipeline routes, The London Times reports.
Indeed. Shell proposes to construct off-shore platforms adjacent to, and to punch undersea pipelines through, the only feeding habit of one of the worlds most critically endangered whale species, the Western Pacific Gray Whale. These plans are drawing fire from Russian and international environmental organizations and concerned scientists. They point out that only 100 of these magnificent creatures are left on earth, and less then 20 are females capable of bearing calves. Thus, they worry that Shells Sakhalin II project could spell extinction.
Shell executives knew about this all along. Shell should have designed the project right in the first place by avoiding the whales altogether. Instead, they decided to run the extinction gauntlet. Now Shell is paying the price, said David Gordon, Acting Executive Director of Pacific Environment.
Shell also proposes to trench 800 kilometers of on-shore pipelines across over 1000 watercourses, including excavating across the delicate river beds of wild-salmon bearing streams. Environmentalists have called on Shell to abandon this retrograde practice in favor of modern-day aerial stream crossings.
Trenching pipelines through wild salmon stream beds is to global best practices what bloodletting is to modern medicine, said Doug Norlen, Policy Director for Pacific Environment.
High seismic risks present uncertain liabilities for Sakhalin II, which is located in an area where earthquakes of 8.0 are not uncommon. An independent report released March 2, 2004, by five Russian, Japanese and U.S. environmental organizations exposes that Shells Sakhalin II seismic examinations present incomplete, inaccurate and contradictory information, understate seismic risks, fail to provide documentation of site-specific risks at individual fault crossings, and that Shells assessment of risks is base on hazards to people, but not to the environment in this natural and sparsely populated region.
Shell executives may have failed to inform their shareholders that the scofflaw Sakhalin II project may be stopped in court. Russian environmentalists seeking to protect the unique environment of Sakhalin Island have filed a lawsuit against Russian authorities demanding the a halt to Sakhalin II project activities that put at risk endangered species including the Western Gray Whale, Steller's sea eagle, and Sakhalin Taimen. A Moscow court has agreed to review the case and has set the next hearing for May.
Shells approach on Sakhalin II has been to short-change environmental protection just to save a buck. They are finding out the hard way that this approach costs far more in the long run, said Gordon.
Public finance institutions like the European Bank for Reconstruction and Development, and the Export Credit Agencies of the U.S., U.K., The Netherlands and Japan are deliberating whether to finance Sakhalin II. Institutions considering support include the U.S. Export-Import Bank, the U.K. Export Credit Guarantee Department, and the Japanese Bank for International Cooperation.
Public money should not be used to prop up Shells risky schemes or to reward such reckless behavior, said Norlen. If these institutions choose to support such a reckless project as Sakhalin-II, they will be complicit in the possible extinction of such incredible creatures as the Western Pacific Gray Whale.
Pacific Environment protects the living environment of the Pacific Rim by strengthening democracy, supporting grassroots activism, empowering communities, and redefining international policies. Pacific Environment provides direct support to activists working on Sakhalin Island.