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Shell, Exxon didn’t apply for withdrawal from Sakhalin projects — Deputy PM

Later on Thursday, Shell announced that it had notified the Russian government and Sakhalin-2 partners that it would not participate in the new operator of the project and retained all related legal rights

MOSCOW, September 1. /TASS/. Shell and ExxonMobil have not asked the Russian government to allow them to withdraw from the Sakhalin-2 and Sakhalin-1 oil and gas projects, Deputy Prime Minister Alexander Novak said.

"No, I did not see any permits. There were no requests," he told reporters, answering questions about requests from these companies to withdraw from the projects.

Later on Thursday, a participant in another Sakhalin project, Shell, announced that it had notified the Russian government and Sakhalin-2 partners that it would not participate in the new operator of the project and retained all related legal rights.

Situation around Sakhalin 1

In March, ExxonMobil announced that it was pulling out of the Sakhalin-1 oil and gas project and withdrawing its US employees from oil and gas projects in Russia.

In August, the company said it was in the process of transferring its operating interest in the Sakhalin-1 project to another party, without naming it.

Rosneft then reported that on April 26, Exxon, without agreement with other project participants, began to gradually halt the production, and from mid-May, production at the project was practically stopped.

On Tuesday, the Wall Street Journal reported citing sources that ExxonMobil, one of the largest US oil companies, could go to court if the Russian government does not allow it to withdraw from the Sakhalin-1 oil and gas project.

A representative with Rosneft told reporters that controversial issues on Sakhalin-1 can be resolved after the project returns to normal production activity and financial disagreements on Sakhalin-1 are caused by the fact that Exxon had stopped production within the project in mid-May.

On August 5, Russian President Vladimir Putin signed a decree on the application of special economic measures in the financial and fuel and energy sectors due to unfriendly actions of some states and international organizations. It prohibits making a number of transactions until December 31, 2022 related to the participation of foreigners from unfriendly states in Russian companies. The restriction applies to shares, rights and obligations in the Sakhalin-1 oil and gas project.

The operator of Sakhalin-1, Exxon Neftegaz, a subsidiary of ExxonMobil, owns a 30% stake in the project. Other participants are: Rosneft (20%), Japanese Sodeco (30%), Indian ONGC Videsh (20%).

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