Exxon does it like BP and Shell
The oil giants are turning their backs on Russia
03/02/2022 02:54 am
First Shell and BP, now the US oil company ExxonMobil and the Italian oil company Eni follow: more and more Western companies are leaving Russia. Moscow wants to counteract the sanctions with a presidential decree and prevent capital flight.
Other Western oil companies are shutting down their business relationships with Russia because of the Ukraine war. The US oil company ExxonMobil announced on Tuesday that it intends to gradually withdraw from the operation of a large oil field in Russia. “In response to the recent events, we are beginning the process of cessation of activities and taking measures to phase out the oil project,” the company said.
Exxon Mobil has been operating the Sakhalin-1 oil field in the far east of the country since 1995 on behalf of a consortium that includes the Russian oil company Rosneft, an Indian company and a Japanese company. The US group owns 30 percent of the shares in the project. As ExxonMobil further announced on Tuesday, the group also no longer wants to invest in new projects in Russia.
Meanwhile, Italian oil company Eni announced on Tuesday that it would withdraw from the Blue Stream gas pipeline between Russia and Turkey. Eni holds 50 percent of the shares, the other half belongs to the Russian gas company Gazprom. “Eni intends to sell its stake in Blue Stream,” said a company spokesman.
In addition, Eni has hardly any business relations with Russia. “The current presence of Eni in Russia is marginal,” emphasized the spokesman. Joint ventures with Rosneft linked to exploration licenses in the Arctic have been “frozen for years” due to the sanctions imposed on Russia since 2014, he said.
ExxonMobil and Eni join the British-Dutch oil company Shell and the British BP, which had already announced their withdrawal from the Russian market. Shell said Monday it would divest its 27.5 percent stake in the Sakhalin-2 oil and gas project in Russia’s Far East. It will also end its 50 percent stake in the Salim oil field in western Siberia and the Gydan exploration project on the peninsula of the same name in northwestern Siberia.
Shell also intends to end its participation in the Nord Stream 2 pipeline in the Baltic Sea. Shell is one of five energy companies involved in the controversial Russia-Germany pipeline. BP announced on Sunday that it was selling its Rosneft shares. BP held a nearly 20 percent stake in the Russian oil company.
Meanwhile, French energy giant TotalEnergies announced on Tuesday that it would no longer invest in new projects in Russia. However, the French at the same time stated that they do not plan to withdraw from ongoing projects.
Because more and more Western companies are withdrawing from Russia because of the sanctions, the Kremlin is preparing a presidential decree intended to prevent capital flight. “In order to give companies the opportunity to make informed decisions, a draft presidential decree has been prepared to introduce temporary restrictions on the withdrawal of Russian assets,” Prime Minister Mikhail Mishustin said on Tuesday.
Russia attacked Ukraine last Thursday and was therefore hit with numerous sanctions by the West. The economic sanctions include the exclusion of Russian banks from the international Swift payment system and export restrictions for numerous branches of industry.