London
CNN Business
,
Shell is exiting Russia and ending its joint ventures with Gazprom, including its involvement with the death Nord Stream 2 Natural Gas Pipeline,
The UK-based oil company said on Monday it would cut its 27.5% stake in the Sakhalin-2 liquefied natural gas facility, its 50% stake in a project to develop the Salim fields in western Siberia and its 50% stake in an exploration project. Will dump The Gdan Peninsula in northwestern Siberia.
“We are shocked by the loss of life in Ukraine, which we condemn, resulting from a senseless act of military aggression that threatens European security,” Shell said.
(RDSA) CEO Ben van Burden said in a statement.
Shell’s move follows BP
(bp) announced on Sunday it was exiting Russia, leaving one of Russia’s biggest foreign investments 19.75% stake in Rosneft and associated joint ventures. Analysts said on Monday that BP could take a hit of more than $26 billion as it moves away from its business in the country.
“Our decision to exit is one we take with conviction,” Van Burden said. “We can’t – and we won’t – stand.”
Shell earned about $700 million in 2021 from joint ventures between Sakhalin and Salim. Its interests in Russia were valued at about $3 billion at the end of the year, and the company said abandoning the Gazprom projects would likely lead to allegations of impairment.
The company was one of five that provided 50% financing and guarantees for the estimated €9.5 billion ($10.6 billion) cost of building Gazprom’s Nord Stream 2 pipeline under the Baltic Sea between Russia and Germany. The project was effectively killed last week when German Chancellor Olaf Scholz said the country would halt certification of the pipeline.
Other Western energy companies, including ExxonMobil, continue to have a presence in Russia
(XOM)Which has been active there for more than 25 years.
Its subsidiary, Exxon Neftegas Ltd., has a 30% stake in Sakhalin-1 – a massive oil and natural gas project located on the island of Sakhalin in the Russian Far East. It has conducted the project since 1995 on behalf of a consortium that includes Japanese and Indian partners as well as two partners of Rosneft.
— Chris Liakos contributed to this article.