Shell, Gazprom Appoint Andrey Galayev To Head Sakhalin JV

Sakhalin Energy, a joint venture with gas giant OAO Gazprom (GAZP.RS) and oil major Royal Dutch Shell (RDSA) as main shareholders, has appointed a Gazprom-insider Andrey Galayev as its chief executive, the company said Friday.

Galayev, who worked for Gazprom's export arm before joining Sakhalin Energy as deputy chief executive in 2007, replaces the Shell-appointed Ian Craig.

State-controlled Gazprom became the main shareholder in Sakhalin Energy in 2007, when Shell was forced to give up control of the company, after accusations by Russian authorities for exceeding costs and violating environmental law.

Do we need to say whether the accusations were proved or shell's point of view? Outgoing Ian Craig led the company for five years and will take up a new position at Shell early next year.

The Sakhalin joint venture, in which Gazprom holds a 51% stake, Royal Dutch Shell a 27.5% stake, Mitsui & Co. Ltd. (8031.TO) has 12.5% and Mitsubishi Corp. (8058.TO) 10%, operates the Sakhalin-2 project on Russia's Pacific Coast and launched Russia's first LNG plant in February.

Company Web site: www.sakhalinenergy.ru

-By Jacob Gronholt-Pedersen, Dow Jones Newswires; +7 495 937 8445; jacob.pedersen@dowjones.com

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