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EBRD's Credibility Gap

22 May 2006

Environmentalists and campaigners, including Friends of the Earth groups, have presented a dossier of evidence about environmental problems with the Shell's Sakhalin II at the EBRD's annual meeting. Campaigners also presented the EBRD's President with 10,000 signatures collected from people on the island calling on the Bank to deny financial support to Shell.

The European Bank for Reconstruction and Development (EBRD) is a bank that proclaims to ‘promote environmental sensitivity' - yet it is on the brink of giving high profile support to a project that is ripping up the pristine landscape of Sakhalin Island (situated between Russia and Japan) and destroying local communities and livelihoods in the name of profit, power and progress. Sakhalin II, Phase 2, is an oil and gas project, lead by Shell, and it plans to extract oil and gas year round off Sakhalin Island, even in frozen seas.

The EBRD is about to back a project that is:

  • Infringing on the feeding grounds of the rare Western Gray Whale , believed to be extinct until 1973. Of little more than 100 whales left, only around 20 are breeding females.

  • Laying two 800km-long pipelines for oil and gas down the length of Sakhalin island whose terrain is:

    • Prone to earthquakes: ten years ago, a quake measuring 7.5 on the Richter scale killed 2,000 people in the town of Neftegorsk.

    • Prone to typhoons and extremely harsh weather conditions

    • Littered with unexploded ordnance.

  • Disrupting the local community , taking locals away from their natural independent livelihood: fishing. The pipelines cross 1,000 rivers, streams and brooks, interfering with salmon spawning and harming the island's fishing industry. Serious damage to a significant number of these economically vital rivers continues to be discovered by Sakhalin Environment Watch .

  • Failing to fully address impacts on the indigenous peoples before construction. Local communities practice a traditional self-subsistence economy based on fishing, hunting, reindeer herding and wild plant gathering. The EBRD has admitted that the indigenous people's impact assessment has not been produced in conformity with Bank policy.

  • Exploiting oil and gas reserves year-round , including in frozen seas. The project will access fossil fuels which will produce over a billion tonnes of carbon dioxide, an important greenhouse gas which is driving climate change.

  • Unprepared for the event of an oil spill under ice. In 2004 an estimated 1,300 barrels of fuel were spilled at ice-free Kholmsk. It took nine hours for their oil spill emergency response contractor to arrive and conduct visual observations, and more than 48 hours for it to transport necessary equipment to the site.

  • Run by Shell, who made $23 billion profit in 2005,and who have ignored scientific advice while constructing platforms and pipelines at Sakhalin. Shell is the lead company (55%), Mitsui and Mitsubishi are its partners in the Sakhalin Energy Investment Company.

Act now Join the 10,000 local inhabitants who strongly oppose the Sakhalin Energy project and have signed a petition demanding to cancel the EBRD loan - send your email to the EBRD.

Sakhalin II Phase 2 is being seen as the "gateway to the Arctic" – a whole host of oil and gas projects in far northern seas are likely to follow, with grave implications for ecosystems in places such as the Barents Sea. Instead of supporting fossil fuel projects, the Bank should be setting a vigorous agenda for renewable energy and helping us to avoid catastrophic climate change.

find out more

About Sakhalin island .

Dirty dossier on Shell's Sakhalin II Project presented to funders.

Watch the video

 

Interactive map of the pipeline hotspots .

Bankwatch's Sakhalin page.

Boom time blues - big oil's gender impacts in Azerbaijan, Georgia and Sakhalin (pdf).

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