VZCZCXYZ0001
PP RUEHWEB

DE RUEHMO #1866/01 1131233
ZNR UUUUU ZZH
P 231233Z APR 07
FM AMEMBASSY MOSCOW
TO RUCPDOC/USDOC WASHDC PRIORITY
INFO RUEHC/SECSTATE WASHDC 9623
RHMFIUU/US CUSTOMS AND BORDER PROTECTION WASHINGTON DC

UNCLAS MOSCOW 001866 
 
SIPDIS 
 
SIPDIS 
 
USDOC FOR 532/OEA/MHAMES/LRITTER 
USDOC FOR 3150/USFCS/OIO/CEENIS/MCOSTA 
 
E.O. 12958: N/A 
TAGS: BEXP ETRD ETTC RS
SUBJECT: EXTRANCHECK: PRE-LICENSE CHECK: 
SEVMORNEFTEGEOFIZIKA (SMNG), MURMANSK, RUSSIA, LICENSE 
NO. D371224 
 
REFTEL: USDOC 01279 
 
¶1. Unauthorized disclosure of the information provided 
below is prohibited by Section 12C of the Export 
Administration Act. 
 
¶2. Reftel requested a Pre-license check to determine 
the legitimacy and reliability of the end-user, 
Sevmorneftegeofizika, Murmansk, Russia. The company is 
listed on BIS license application D371224 as the 
ultimate consignee of a Syntrak active receiver array. 
These items are controlled for national securities 
reasons under ECCN 6A001. The licensee is Ocean 
Geophysical Services, Inc., 10850 Richmond Ave., 165, 
Houston, TX 77042. 
 
¶3. On April 19, 2007, Export Control Attache Donald 
Pearce and FSN Natalya Shipitsina conducted the 
requested pre-license check at the offices of 
Sevmorneftegeofizika (SMNG), 17, K. Marks St. 
Murmansk, Russia. The export control team met with 
Sergey Rabey, Head of Foreign Economic Relations 
Department and Mikhail Zhestkov, Head of Sea Works 
Department. 
 
¶4. SMNG was founded in 1979 to provide oil and gas 
geophysical and geological exploration services in the 
arctic seas of the former Soviet Union.  SMNG was a 
Federal-State Unitary Enterprise until 2003, when it 
was transformed into an Open Joint Stock Company. 
Currently the Government of Russia (GOR) owns 100% of 
the shares, though recently the Duma (GOR legislative 
branch) approved the full privatization of the 
company.  Mr. Rabey stated that Gazprom, Rosneft and 
several foreign companies have expressed interests in 
obtaining shares of SMNG.  The company employs around 
540, and is headquartered in Murmansk, with offices in 
Gelendzhik (SMNG South) and a data processing center 
in Moscow. 
 
¶5. SMNG has a fleet of seven vessels.  Four of the 
vessels are designed for deep-water operations, and 
three principally used in littoral areas though they 
can be employed on the high seas as well. 
Currently four of the seven vessels are at sea on 
projects, with one heading into port for maintenance, 
one in port for overhaul, and a third in long-term 
dry-dock in Bulgaria due to lack of business activity 
in the area.  The last three years have been very 
profitable for SMNG, which has lead the company to 
reinvest profit to upgrade the capabilities of the 
fleet and shore installations. The company works in 
the Arctic zone from May through September, and then 
transfers vessels to warmer climes for winter work. 
SMNG's clients are the GOR Ministry of Natural 
Resources and many major oil and gas companies.  SMNG 
provided a CD-ROM with detailed information on the 
organization services provided, which is available 
from post upon request. 
 
¶6. The equipment in reftel will be installed aboard 
the Iskatel-5 (Searcher-5), a catamaran built in 1987. 
The vessel provides two-dimensional geophysical 
charting from shallow waters, through the littoral 
transition zone, to deep waters.  The equipment will 
be secured aboard the vessel, and the crew maintains a 
24-hour watch while the vessel is in port.  ECO Pearce 
inquired about foreign contract work, specifically 
requesting information about potential contracts 
involving Iran, Syria, North Korea, and Cuba. Mr. 
Rabey stated that Iskatel 5 would only be employed on 
projects in the Barents Sea along the coasts of Russia 
and Norway. Both Mr. Rabey and Mr. Zhestkov are 
familiar with U.S. export controls, as the company 
utilizes U.S. equipment and technology on several 
vessels, and assured the ECO that license conditions 
will be strictly observed.  NOTE: the CD-ROM noted in 
paragraph 5 indicates that Iskatel-5 has operated in 
Cuban waters in the past. END NOTE. 
 
¶7. Recommendations: While post believes 
Sevmorneftegeofizika, Murmansk, Russia, to be a 
reliable recipient of sensitive U.S. origin 
commodities, we call the licensing officer's attention 
to the fact that the company has participated in 
contract work in the Caribbean, including Cuban 
 
 
waters. ECO recommends a specific license condition to 
prohibit the use of the equipment in Cuban territorial 
waters.  It is requested that post be notified of 
final disposition of the application, and of any 
shipments for this organization in order to conduct 
appropriate FCS follow-up and statistical reporting. 
(FCS MOSCOW/SBOZEK/DPEARCE) 
BURNS