U.S. Oil Giant Announced Complete and 'Safe' Exit from Russian Market

SEATTLE (Oil Monster): U.S. oil giant ExxonMobil announced that it has completely exited from the Russian market. This follows recent appropriation of its assets by President Vladimir Putin through a government order. The seven-month long discussions in connection with an orderly transfer of its 30% stake in the Sakhalin-1 oilfield in the Russian Far East had ended in failure.

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Meantime, ExxonMobil refused to disclose whether it has received any compensation from Russian government for the unilateral termination of the Sakhalin-1 oilfield interest and subsequent transfer of the same to local operator. The spokesperson also declined to comment on whether the company will approach international arbitration authorities to challenge the seizure of assets.

It must be noted that ExxonMobil had reduced its output from Sakhalin-1 oilfield assets starting July this year, limiting the volumes just enough to meet the requirement of two Far East Russian cities of Khabarovsk and Vladivostok.

Nearly 700 Russia-based employees of the oilfield will be transferred to the new Russian company that takes over the asset. The foreign partners of Sakhalin-1 will be given one-month time from the date of creation of the new Russian company, to ask for apply for shares in the new entity.