The Khabarovsk regional government has an agreement with Exxon Neftegaz Ltd under which the region receives 2bn cum/yr of gas. "The economically beneficial effect of natural gas coming to our region is obvious," Mr Ishayev said, pointing out that in the city of Komsomolsk-on-Amur, 85% of residents consume piped gas, which is half the price in comparison with liquefied gas, although not all the city's apartment blocks have been converted for piped-gas usage. Discussions also covered plans for a gas pipeline to China with a capacity of about 8bn cum/yr, and Exxon Neftegaz Ltd has been granted permission by the regional government to make a preliminary study of possible route. However, Russia's state gas monopoly Gazprom reportedly intends to oppose Exxon's plan for a gas line to China, as it has itself has developed a rival project. Exxon and its partners, who include state oil firm Rosneft and Japan's Sodeco, are currently negotiating with China's CNPC to build a $1bn pipeline from Sakhalin. Opposing this, a Gazprom source is quoted as saying: "Exxon's pipeline is not foreseen in the programme of development of Russia's Far East and East Siberia, and does not meet the goal of development of a gas transportation system in the country's east." Observers say that the rivalry among Russian state companies and the two Sakhalin oil consortia, led by Royal Dutch Shell and ExxonMobil, has led to more pressure on the Sakhalin operators following the Natural Resources Ministry's environmental agency Rosprirodnadzor saying it wanted Shell to freeze construction of the pipelines on the Sakhalin-2 oil and gas project for ecological reasons. The deputy head of the Natural Resources Ministry's ecological department, Oleg Mitvol, said that Shell should stop building onshore pipelines as they could be destroyed by mudflows, according to recently-published a press statement. The Ministry's agency is to launch an inspection of the oil pipeline, to ensure that it corresponds with Russia's construction standards and regulations, Mr Mitvol said. Sakhalin Energy responded that the existing pipelines were originally approved by Rosprirodnadzor in 2003, and are well shielded from mudflows.