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Russian Office of General Prosecutor sues Shell for one bln euro

The lawsuit claims that Shell did not meet its obligations in the Sakhalin Project, and therefore must pay damages

MOSCOW, October 15. /TASS/. The Moscow Arbitration Court has accepted a lawsuit filed by the Russian Prosecutor General’s Office against global oil giant Shell, which seeks more than one billion euro in damages for default on obligations under the Sakhalin-2 project, the court’s press service told TASS.

"The amount asked in the lawsuit from the Russian Prosecutor General’s Office against the UK-Dutch Shell stands at more than one billion euro," the press service informed.

The lawsuit claims that Shell did not meet its obligations in the Sakhalin Project, and therefore must pay damages.

Among those named in the suit are UK-registered Shell plc and Shell Energy Europe Limited, Dutch Shell Global Solutions International B.V., Shell International Exploration & Production B. V., Shell Exploration & Production Services B. V., Shell Sakhalin Services B. V., and Shell Sakhalin Holdings B. V., and Moscow-based Shell Neftegaz Development.

Gazprom Export, the Russian Ministry of Energy, former and current Sakhalin-2 project operators, and the Government of the Sakhalin Region act as third parties.

Shell Neftegaz Development, the lone Russian defendant in the lawsuit, made the decision to liquidate earlier.

Shell participated in the Sakhalin-2 project in Russia, originally owning a 27.5% stake. In June 2022, Russian President Vladimir Putin signed a decree whereby Russia-based Sakhalin Energy LLC became the project operator instead of Sakhalin Energy company. Mitsui and Mitsubishi agreed to keep their stakes in Sakhalin-2, while Shell said it would pull out of the project. Novatek put forward a bid to purchase the stake and received the buyout permit but the deal fell through. As a result, Sakhalin Project, a Gazprom subsidiary, swooped in to buy the stake. Gazprom’s share in the project increased as a result from 50.0000001% to 77.5%.