January 7, 2011 / 12:53 PM / in 9 years

Statoil sees "serious" Shtokman risks-Wikileaks

* Statoil cites growing corruption, politics, market worries

* Cable comes ahead of final Shtokman decision

OSLO, Jan 7 (Reuters) - Norwegian oil firm Statoil STL.OL said it faced rising corruption and other “serious challenges” at Russia’s giant Shtokman gas project in the Arctic, according to a U.S. cable leaked to Wikileaks and published on Friday.

The leak comes two months before the Shtokman partners are due to make their final investment decision on developing the field, which holds an estimated 3.8 trillion cubic metres of gas — enough to meet global demand for more than a year.

Gazprom’s field lies 650 km offshore in iceberg-strewn Barents Sea waters and requires building complex facilities on Russia’s cold and remote Kola peninsula.

“(Statoil CEO Helge) Lund said he was very worried about corruption and opined that it is worsening,” said the cable by U.S. Ambassador Barry White from December 2009. It was published by Norwegian daily Aftenposten on Friday.

According to the note, Lund told White “the project faces a number of other serious challenges, including lack of local infrastructure combined with local content rules; risk of low gas prices continuing into the future, thanks to the impact of shale gas discoveries; and overall political risk.”

Statoil has a 24 percent stake in the company developing Shtokman. Russia’s Kremlin-controlled Gazprom (GAZP.MM) has 51 percent in the Barents Sea project that is likely to cost tens of billions of dollars, while Total (TOTF.PA) has 25 percent.

Asked for comment on the Wikileaks report, a Statoil spokesman said: “We are working together with our partners to move this project forward. This is a project of tremendous opportunity for Statoil but we have also always been open about it being a challenging project.”

Gazprom spokesman Sergei Kupriyanov said: “As there is no one saying this at Statoil... no comments could be made.” (Reporting by Walter Gibbs, Wojciech Moskwa and Andrey Ostroukh; editing by James Jukwey)

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