Russian approves disputed oil pipeline along Lake Baikal
(Reuters)
Updated: 2006-03-07 10:06

Russia's environmental watchdog said on Monday it had approved a controversial pipeline that will take oil to Asian markets, but that green groups say could severely damage the world's deepest lake, Lake Baikal.

The Eastern Siberia-Pacific Ocean pipeline has the full backing of President Vladimir Putin and would allow the world's No. 2 oil exporter to diversify its massive shipments away from Europe's slow-growing markets.

Scientists, whose opposition to the plan was overruled, promised to appeal the Rostekhnadzor watchdog's decision, but analysts said now the last obstacle had been removed pipeline monopoly Transneft would rush to complete it.

The pipeline will cost $11 billion and will pump as much as 1.6 million barrels per day to China and the Pacific coast.

The expert commission gathered by Rostekhnadzor had previously rejected the plan, but approved it after watchdog head Konstantin Pulikovsky brought in new scientists and gave the commission more time for consideration.

"Yes, Pulikovsky has signed a positive assessment. He signed it on March 3," said Rostekhnadzor spokesman Alexander Afonin.

Lake Baikal, home to a freshwater seal and hundreds of other unique species, is sited in an earthquake-prone zone, and many experts say that makes the pipeline vulnerable to rupture.

NOT OVER YET

Opponents said their fight against the plan was not over, and accused Pulikovsky and Transneft boss Semyon Vainshtok of forcing their colleagues to change their assessment and overturn the expert commission's rejection of the plan.

Gennady Chegasov, an academic and member of the investigating commission, said the pressure on members and the fiddling with the group's composition would have been unusual even in Soviet times.

"The unprecedented amount of boorishness and pressure would not be possible without the government's support," he said.

"We will appeal the result of the investigation in court ... I am prepared to appear as an expert and as a witness of the violations that took place," he told reporters.

But analysts said the political support behind the plan made it unstoppable, especially since Putin has urged speed -- going so far as saying opponents of the plan were saboteurs in the pay of foreign governments.

"He declared that it was a priority project for Russia's social and economic development, adding that the environmental investigation should not hinder the country's economic growth," said Deutsche-UFG investment bank in a note.

Environmental groups admitted the state machinery would be against them, and said they would try to organise protests in defence of the lake, which is the world's deepest, contains 20 percent of the earth's unfrozen fresh water and is a UNESCO world heritage site.

"We understand that in the Russian legal system it will be hard to fight a state company that has support from the presidential administration," said Roman Vazhenkov, head of Greenpeace's Baikal programme.

Greenpeace has appealed to Western banks to refuse to finance the project. Russian media have reported the company will need $2 billion in loans for the project this year alone.