Exxon Mobil to Sue Russia for Blocking Sakhalin-1 Sale - Reports

WASHINGTON (Pakistan Point News / Sputnik - 30th August, 2022) Exxon Mobil plans to sue the Russian government for blocking the sale of its stake in the Sakhalin-1 project, The Wall Street Journal reported Tuesday, citing sources familiar with the matter.

Russia has barred investors from countries it considers unfriendly from selling shares in strategic enterprises through 2022, a ban which can be extended beyond this year. An Exxon spokesperson confirmed that the company recently sent a notice of difference to the Russian government in an attempt to resolve the conflict by a certain deadline, lest it resort to litigation. Exxon plans to transfer its operatorship and sell its 30% stake in the oil and gas project.

Rosneft, the Russian partner in the consortium behind the project, has blamed the conflict on Exxon unilaterally deciding to reduce production, adding that resuming normal levels could set the stage for resolving it.

One of many Western companies that decided to exit Russia over the special operation in Ukraine, Exxon declared force majeure in April and has reduced oil and gas production in the project from 220,000 to 10,000 barrels per day. The Wall Street Journal said it was unclear when the notice of difference was filed, but sources said Exxon did not expect to resolve the matter by the deadline and was preparing to file a lawsuit.