Moscow orders legal action against BP joint venture over Russian spills

Moscow has ordered the country's environmental regulator to sue BP's Russian joint venture over leaks from pipelines in the Ob and Yenisei rivers, the Guardian newspaper reported today.

Shares in TNK-BP fell as much as 5 percent after a transcript of a cabinet meeting chaired by President-elect Vladimir Putin was published on the government website earlier today, the Financial Times reported.

"I ordered Rosprirodnadzor (the environmental regulator) to prepare a lawsuit to seek damages and offered the company to lay out a plan on overhauling their pipeline system," natural resources and ecology minister Yuri Trutnev said.

"Please, act in line with the law," Putin was reported to have said in response, according to the Guardian.

Trutnev made the remarks after visiting the Khanty-Mansiysk region in Western Siberia where he inspected environmental violations at the Samotlor oil field, Agence France-Presse reported.

He has given the company a month to clean up the spills from the polluted 2,200 hectares.

The joint venture between BP and a consortium of Russian oligarchs was set up in 2003 and is the third biggest oil producer in Russia, Agence France-Presse said.

It accounts for a quarter of BP's global production. 

The news comes after BP announced Wednesday a multi-billion-dollar payout to thousands of businesses and individuals affected by the 2010 spill in the Gulf of Mexico, two days before the second anniversary of the disaster, CNN said.

Trutnev told the government meeting that 784 “accidents” had occurred in TNK-BP’s Siberian pipeline system last year and led to spills — far more than the  20 or 30 per year in the systems of the company’s peers, Surgutneftegaz, Lukoil and Bashneft, the Financial Times said.

TNK-BP said Wednesday it has been improving and modernizing its pipeline system, but denied it was suffering self-inflicted environmental problems.

The company has implemented "a program for remediation of legacy lands contaminated in the Soviet period when hydrocarbons were produced without due regard to environmental protection," it said in a statement.