ExxonMobil will cease cooperation with Rosneft due to sanctions

The largest oil and gas corporation of the USA because of the anti-Russian sanctions intends to withdraw from the general projects with Rosneft in search of new hydrocarbon deposits. ExxonMobil said it would result in losses amounting to $ 200 million.
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The US corporation ExxonMobil in 2018 will begin to withdraw from joint projects with Rosneft to search for oil deposits, according to the company's annual report, which it sent to the US Securities and Exchange Commission (SEC).

The company noted that it does so in compliance with the requirements of the US government, which in 2017 legislatively consolidated and expanded sanctions against Russia.

The report notes that in 2013-2014, the US corporation and Rosneft created various units for research and oil prospecting. In 2014, ExxonMobil points out, the US and EU countries imposed restrictions on Russia's energy sector, and in the second half of 2017, the White House expanded and legislated these sanctions.

"In view of the foregoing, the corporation and its subsidiaries intend to comply with all legal requirements, rules and regulations. In late 2017, the corporation decided to withdraw from these joint projects. The corporation believes that the official withdrawal will begin in 2018, "- follows from the document.

Also in the US oil and gas company, they calculated their possible losses: according to them, the decision to withdraw from joint projects with Rosneft will result in a loss of $ 0.2 billion.

The report says that at the end of 2017, Exxon, in joint ventures with Rosneft, had the rights to drill in Russia on an area of ​​63.6 million acres in several seas. This is five times more than the area in the US (12.8 million acres), on which Exxon can drill.

Russia's trade representative to the US Alexander Stadnik, commenting on ExxonMobil's decision, told RIA Novosti that the company's refusal to cooperate with Rosneft suggests that anti-Russian sanctions are working to the detriment of American business. The very decision of the American company he called forced.

"We can talk as much as we like about the allegedly billions in losses of the Russian defense complex because of US sanctions. However, the situation with ExxonMobil, by contrast, indicates that the creators of sanctions use dictatorial methods against the American business, shooting at him in the foot, "Stadnik said.

ExxonMobil is a long-time partner of Rosneft. However, since 2014, cooperation began to face difficulties after the US Treasury banned American businesses and citizens from providing technology and services for projects in Russia on the Arctic shelf, deep water and shale formations. So, in the fall of 2014, the US company suspended its joint work with Rosneft on the Arctic shelf. The companies managed to drill only one well - "Universitetskaya-1" in the Kara Sea together.

When Donald Trump selected ExxonMobil CEO Rex Tillerson at the time of the end of 2016 as US Secretary of State, critics of the American president feared that Tillerson would help his former company resume work in Russia. However, in April 2017, the US Treasury announced that it would not issue ExxonMobil licenses for drilling operations that are prohibited by existing sanctions against Russia. In July 2017, the US Treasury fined Exxon for $ 2 million for signing several agreements with the head of Rosneft Igor Sechin in May 2014 (he had been on the sanctions list since April 2014), Exxon challenged the fine in a Texas court.

In total, ExxonMobil and Rosneft had 10 joint projects, which included exploration and development of the Russian shelf in the Black Sea and the Arctic, as well as projects in Western Siberia. All of them were suspended. The sanctions did not affect only the Sakhalin-1 oil and gas project in the Sea of ​​Okhotsk, where Exxon is the operator, and Rosneft is one of the partners.

ExxonMobil announced withdrawal from projects with Rosneft due to sanctions
Kommersant, March 1, 2013

US oil company ExxonMobil announced withdrawal from joint projects with Russian Rosneft. This decision was made by an American company because of sanctions imposed by the United States and the European Union. The loss after taxation of ExxonMobil could reach $ 200 million, Reuters reports.

In 2017, ExxonMobil was fined $ 2 million for violation of sanctions against the Russian Federation. The US Treasury considered that in May 2014 Exxon illegally signed agreements with the head of Rosneft Igor Sechin, who had already been sanctioned as an individual.

On May 24, 2014, Rosneft announced that it had extended the term of the agreement on the Far Eastern LNG project with Exxon. Also, Igor Sechin and ExxonMobil Russia president Glenn Waller agreed on the development by the Sakhalin-1 consortium of the northern tip of the Chayvo field on the shelf.

In September 2017, the Russian government approved the signing of a settlement agreement with ExxonMobil, which required more than $ 600 million from the Russian Ministry of Finance for overpaying the profit tax for the Sakhalin-1 project.

Shareholders of Sakhalin-1 are Exxon (30%, operator), Japanese Sodeco (30%), Rosneft (20%), Indian ONGC (20%). The project includes the Chayvo, Odoptu and Arkutun-Dagi oil and gas fields on the northeastern shelf of Sakhalin. The production of oil and condensate in 2016 - about 9 million tons, the share of Rosneft was 1.8 million tons.

Sakhalin-1 is one of the few joint projects between Rosneft and Exxon that survived the imposition of US sanctions.