Russia extends deadline for Exxon to sell Sakhalin-1 stake to 2026 in a decree
On Monday, Russian President Vladimir Putin issued a decree extending by one year the period of sale for Exxon’s share in Russia’s Sakhalin-1 gas and oil project until January 1, 2026.
Exxon will take a $4.6 billion charge in 2022 for abandoning its development on the Pacific Island of Sakhalin. This was the company's largest investment in Russia after the beginning of what Moscow refers to as a special military operations in Ukraine.
Exxon Mobil Corp owned a 30% stake as operator in Sakhalin-1. It was partnered by Rosneft of Russia, ONGC Videsh from India, and SODECO of Japan.
Exxon didn't immediately respond to a comment request.
The reason for the extension of the sale period is not known. According to a decree signed in October 20,22, it was supposed to expire Jan. 1, 2025.
Donald Trump will become the U.S. president on January 20. Putin stated last month that Moscow is ready to dialogue with the Republican President-elect. He also said that he had seen signals that certain U.S. firms were looking to return to Russia.
A study of filings from companies and financial statements revealed that the exodus of foreign firms from Russia, since the start of the conflict in Ukraine, has cost them more than $107 Billion in revenue and write-downs.
Putin signed another decree in August 2022 that Exxon claimed made it difficult to exit Sakhalin-1 safely and without harming the environment. In response to this decree, the U.S. oil producer issued a "note" of difference. This is a legal action before arbitration. (Reporting from Vladimir Soldatkin. Gary McWilliams contributed additional reporting. (Editing by Louise Heavens, Mark Potter and Mark Potter).
(source: Reuters)
