London Daily

Focus on the big picture.
Sunday, Sep 06, 2026

Exclusive: Exxon exits Russia empty-handed with oil project 'unilaterally terminated'

Exclusive: Exxon exits Russia empty-handed with oil project 'unilaterally terminated'

Exxon Mobil Corp (XOM.N) said on Monday that it left Russia completely after President Vladimir Putin expropriated its properties following seven months of discussions over an orderly transfer of its 30% stake in a major oil project.

Exxon did not say if it received any compensation for the assets, which it had valued at more than $4 billion. An Exxon spokesperson declined to comment on whether it will proceed to contest the seizure through an international arbitration process, a possibility flagged in August.

Its departure illustrates the clash between the West and Russia over energy following Moscow's invasion of Ukraine in late February and threats of using nuclear weapons against the country and its supporters. BP, TotalEnergies, Equinor, and Shell have all transferred properties to Russian partners or left operations behind.

"We made every effort to engage with the Russian government and other stakeholders," the Exxon spokesperson said.

The company said it "safely exited" Russia after the government earlier this month "unilaterally terminated" its interests in the Sakhalin-1 oil and gas project, its largest in the country.

Exxon has been trying to relinquish operation of Sakhalin-1 since March 1, when it announced it would abandon all of its more than $4 billion in assets, leaving open the possibility to sell Sakhalin-1. It said it would "closely coordinate" the transfer of operation with its partners - Russian company Rosneft (ROSN.MM), India's ONGC Videsh (ONVI.NS) and Japan's SODECO to ensure it would be done in a secure way.

In April, Exxon disclosed a $3.4 billion write down on the Russia exit and this month signaled a third-quarter $600 million impairment charge for unidentified assets. Exxon had valued its Russia holdings at more than $4 billion.

On Oct. 7 Putin seized Exxon shares in the oil production joint venture and transferred them to a government-controlled company. In August, Putin had signed a first decree that Exxon said made a secure and environmentally safe exit from Sakhalin-1 difficult. The U.S. producer reacted to August's decree by issuing a "note of difference," a legal step before arbitration.

The harsh language of Exxon's formal exit shows a desired outcome for Exxon - leaving Russia - but in unamicable terms that could translate in multi-year legal disputes, starting with arbitration in European courts.

PHASING OUT


Exxon has been reducing its presence in Russia since 2014, following sanctions against Moscow after it annexed the Crimean peninsula from Ukraine.

The U.S. company had removed earlier this year its expatriate workers and closed its lubricant and chemical businesses in Russia. By July, output at the Sakhalin-1 project fell 10,000 barrels per day (bpd), from 220,000 bpd before Russia invaded Ukraine.

The volume was just enough to provide natural gas to keep the lights on in the Russian cites of Khabarovsk and Vladivostok. About 700 Russia-based employees that kept operations running will be transferred to the new Russia company taking over the asset, Exxon said.

"We are thankful for the professionalism, expertise and commitment demonstrated by ENL’s employees during these difficult circumstances," the Exxon spokesperson said.

Exxon had pledged to take its time and provide for a safe transfer to a new operator to avoid spills, environmental accidents or shutting down the lights of cities supplied by the project.

Russian terms blocked it from transferring operations or negotiating a potential sale to Indian or Japanese partners, which indicated interest in keeping Sakhalin-1's supply.

India's Oil and Natural Gas Corp plans to take a stake in the new Russian entity that will manage the Sakhalin-1 project as it seeks to retain a 20% share in the asset, three sources familiar with the matter said.

Japan will decide what to do about the Sakhalin-1 oil and gas project in Russia's Far East in consultation with its partners as it reviews details of a decree by Moscow, Industry minister Yasutoshi Nishimura said last week.

According to Putin's Oct. 7 decree, Sakhalin-1's foreign partners will have one month after the new Russian company is created to ask the Russian government for shares in the new entity.

Equinor last month agreed to sell Russian assets value at $1 billion for 1 euro. The formal sale allowed Norway's Equinor to forgo future liabilities and investment commitments. On Friday, Danone also sold its assets but kept a minority stake.

Comments

Oh ya 4 year ago
Gee now Exxon maybe knows how it feels to have your stuff taken the same as all those yachts and 300 billion in FX reserves that the US are stealing. I am sure Russia will put those resources to go use as Europe freezes in the dark. Europe might learn someday it is not good to be a US lapdog

Newsletter

Related Articles

0:00
0:00
Close
OpenAI Unveils GPT-6 and Says: "We May Already Have Reached AGI"
Congressman Accused Andrew of Sex Crimes in the United States
Donald Trump: "I'm Glad Harry and Meghan Left the United States"
Spicy Food Is Linked to Lower Death Risk — but It Is Not a Miracle Cure
AfD Enters Saxony-Anhalt Election at 41% in Historic Test for German Politics
Gen Z Turns to Investing as America's First-Home Dream Moves Further Out of Reach
Thousands Join Anti-Abortion March Through Central London
UK Beekeepers Call for Nationwide Tracking as Asian Hornet Sightings Increase
England Sees Sharp Rise in Property Subsidence Claims After Record Summer Heat
House of Lords Advances Financial Services Reform Bill
House of Lords Begins Detailed Scrutiny of Railways Bill and Great British Railways Plan
UK Treasury Cuts Green Book Discount Rate to Support More Regional Infrastructure Projects
Reform UK Suspends Two Senior Aides After Undercover Report on Foreign Donation Rules
UK Chancellor Warns Autumn Budget Will Require Tough Choices as Energy Shock Squeezes Public Finances
UK Parliament Raises Concerns Over Funding Structure of £400 Million Tropical Forest Initiative
Andy Burnham Launches Number 10 North as Part of UK Devolution Push
UK Reaffirms Falkland Islands Sovereignty Amid Renewed Regional Pressure
Andy Burnham to Abstain From Assisted Dying Vote as Ministers Are Told to Remain Neutral
Kemi Badenoch Sacks Shadow Chancellor Mel Stride in Conservative Economic Strategy Shake-Up
UK Government Drops Early Prisoner Release Plan in Favor of Deportations and Wider Prison Reform
UK Farmers Warn Drought-Hit Harvests Could Push Grocery Prices Higher
UK Economy Faces Persistent Stagflation Risks Ahead of October Budget
Masked Protesters Block Port of Dover Roads, Disrupting Cross-Channel Traffic
Reform UK Suspends Senior Officials After Undercover Investigation Into Foreign Donation Plans
UK Urges Households to Keep Emergency Supplies Amid Severe El Niño Warning
Prime Minister Andy Burnham Sets Out Regional Industry and Prison Reform Agenda
Siemens Energy Wins Rolls-Royce Small Modular Reactor Manufacturing Contract
UK Mortgage Costs Rise as Gilt Yields and Swap Rates Climb
Bank of England’s Huw Pill Calls for Prompt Rate Rise as Inflation Risks Persist
National Audit Office Warns UK Is Unprepared for Major Food Supply Disruptions
British Army Suspends Some Training Exercises as Budget Pressures Intensify
HMS Queen Elizabeth Deploys as NATO Allied Response Force Command Ship
Reform UK Suspends Two Senior Officials Over Alleged Foreign Donation Scheme
UK Reasserts Falkland Islands Sovereignty After Argentina Threatens Sanctions
Scottish Tech Company PureLifi Enters Administration With More Than 40 Job Losses
Scottish Government Names Alyn Smith Innovation and Education Minister
Green Party Co-Leader Zack Polanski to Contest By-Election for Keir Starmer’s Former Seat
Palestine Action Activists Appeal Terrorism-Related Prison Sentences
PwC Report Highlights Persistent Regional Spending-Power Divide Across Britain
UK Names Hundreds of Employers for Minimum Wage Violations
UK Commits £400 Million to International Tropical Forest Fund
UK Extends £2 Bus Fare Cap Across England Through 2027
UK Warns Travellers as US-Iran Tensions Disrupt Middle East Security and Shipping
Andy Burnham Faces Kemi Badenoch in First Prime Minister’s Questions
Kemi Badenoch Names Andrew Griffith Shadow Chancellor in Conservative Reshuffle
UK Treasury and Markets Focus on Fiscal Headroom Ahead of Autumn Budget
UK Government Reverses Early Release Plans for Serious Violent and Sexual Offences
UK and France Review Border Cooperation After 48,000 Small-Boat Crossings Prevented
UK Growth Outlook Weakens as Inflation and Energy Costs Rise
Breeding Tropical Mosquitoes Discovered in East London
×