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    Russia clears state firm taking over foreign shares in Arctic oil project

Summary

Both Equinor and TotalEnergies had already announced agreements to leave the project, contrasting with the situation at Sakhalin 2.

by: NGW

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Russia clears state firm taking over foreign shares in Arctic oil project

Russia's government announced on July 26 it had approved a move by state-owned Zarubezhneft to acquire stakes in the Kharyaga oil project in the Russian Arctic, currently held by TotalEnergies and Equinor.

Both international oil companies had already agreed to leave the project, although the terms of their departure were not disclosed. Equinor said on May 25 it had reached an agreement to exit Kharyaga as part of its complete withdrawal from the Russian market, while TotalEnergies announced on July 6 that it had agreed to transfer its 20% stake in Kharyaga to Zarubezhneft.

The Kharyaga oil project is operated under a production-sharing agreement.

In a more aggressive move, the Kremlin signed a decree on June 30 handing full control over the Sakhalin 2 LNG and oil project to a Russian state entity. While one of the shareholders, Shell, had announced its general plan to withdraw from Russia, Japanese investors Mitsui and Mitsubishi had indicated their desire to remain at the project.