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Court upholds Gazprom Neft petition to transfer its JV with Shell to Russian jurisdiction

OOO GPN-Salym projects and Shell Salym Development B.V. can become participants OOO Salym Development, while maintaining parity shares of 50% of the previous owners

MOSCOW, August 22. /TASS/. The Arbitration Court of the Moscow Region has agreed to the petition of Gazprom Neft to transfer Salym Petroleum Development, the company’s joint venture with Shell from the Dutch to Russian jurisdiction. This is according to the court’s files available to TASS.

Gazprom Neft filed the petition through the GPN-Salym Projects company.

Earlier, Gazprom Neft proposed the creation of OOO Salym Development with an authorized capital of 8.6 mln rubles ($143,712) and registered in Khanty-Mansiysk.

It also asked to suspend the right of Shell to demand a share buyback until the end of 2023.

Previously, the court had already prohibited Shell from withdrawing from SPD, as an interim measure, as well as from taking any actions to approve or make transactions with SPD without the consent of GPN-Salym Projects.

About Salym Petroleum Development

Earlier, a TASS source reported that Shell, which announced its withdrawal from Russian projects in early March, was considering the sale of its stake in the Salym Petroleum Development project, in which stakes were distributed on parity basis.

On April 29, Shell began accepting binding proposals from candidates. According to the source, Shell's stake in the project is estimated at about $1 billion.

Later, Russian President Vladimir Putin banned representatives of unfriendly countries that own shares of Russian strategic enterprises from making deals with them until the end of 2022.

Salym Petroleum Development (SPD)is a joint venture of Shell Salym Development B.V. (part of Shell group) and OOO GPN-Salym Projects (a subsidiary of Gazprom Neft). The companies own stakes on parity basis.

Since 2003, SPD has been developing the Salym group of oil fields, which is located in the Khanty-Mansiysk Autonomous District. The design capacity of oil production at the project is 17,000 tonnes of oil per day, peak production was 8.4 million tonnes per year.

The total reserves of the project fields are estimated at 181 million tonnes in category B1 and B2. The accumulated investment in the project is 171 billion rubles ($2.8 bln).

SPD was formed in 1996 by the shareholders of Shell and the Russian oil company Evikhon (acquired by Gazprom Neft in the late 2000s). Development of the Salym group of fields began in 2003.