London Daily

Focus on the big picture.
Thursday, Apr 09, 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 3 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
Meghan Markle’s Planned Australia Appearance Sparks Fresh Speculation
Starmer Warns Sustained Effort Needed to Ensure US–Iran Ceasefire Holds
UK to Partner with Shipping Industry to Rebuild Confidence in Strait of Hormuz, Cooper Says
UK Interest Rate Expectations Ease Following US–Iran Ceasefire Agreement
Starmer Signals Major Effort Needed to Fully Reopen Strait of Hormuz During Gulf Visit
UK Fuel Prices Face Ongoing Volatility Amid Global Pressures and Domestic Factors
Kanye West’s Planned Italy Festival Appearance Draws Debate After UK Entry Ban
Smuggling Routes Shift Toward Belgium as Migrant Crossings to UK Evolve
Ceasefire Offers Potential Relief for UK Fuel and Food Prices Amid Ongoing Uncertainty
Iran Conflict Raises Questions Over UK’s Global Influence and Military Preparedness
Senator McConnell Visits Kentucky to Highlight Federal Investment in Local Projects
Kanye West Barred from Entering UK as Legal Grounds Come into Focus
UK Denies Visa to Kanye West After Sponsors Withdraw from Wireless Festival
Trump-Era Forest Service Restructuring Leads to Closure of UK Lab Focused on Kentucky Woodland Health
Foreign Students in the UK Describe Harsh Living Conditions and Financial Pressures
Reform UK Proposes Visa Restrictions on Nations Pursuing Reparations Claims
Public Reaction Divides Over UK Decision to Bar Kanye West
Calls Grow for UK to Review US Base Access Following Concerns Over Escalating Rhetoric
UK Indicates It Will Not Permit Use of Its Bases for Potential US Strikes on Iran’s Energy Infrastructure
UK Prime Minister Defends Decision to Bar Kanye West, Questions Festival Booking
UK Accelerates Efforts to Harmonise Medical Technology Rules with United States
Wireless Festival Cancelled After Kanye West Denied Entry to the United Kingdom
Australia’s most decorated living soldier was arrested at Sydney Airport and charged with five counts of war-crime murder for the killing of unarmed Afghan civilians
The CIA’s Secret Technology That Can Find You by Your Heartbeat Successfully Locates Downed Airman
Operation Europe: Trump Deploys Vance to Hungary to Save the EU
King Charles Faces Criticism From Some UK Christians Over Absence of Easter Message
Former UK Defence Secretary Raises Concerns Over Ability to Counter Iran Missile Threat
UK Signals Non-Involvement in Iran Conflict as Trump Reasserts Firm Deterrence Stance
US and UK Strengthen Medical Device Cooperation Following Tariff Removal
Trump Backs Steve Hilton for California Governor, Highlighting Reform Agenda
UK Seeks Closer Ties With Anthropic as AI Policy Divergence Emerges Across Atlantic
Experts Warn of Evolving Extremism After Teens Arrested in UK Ambulance Arson Case
UK Convenes Talks to Safeguard Shipping Through Strait of Hormuz After Conflict Escalation
Trump Highlights Strong Leadership in Critique of UK Stance on Iran
UK Authorities Review Kanye West’s Entry Status Following Festival Backlash
UK Considers Deploying Aircraft Carrier for US Independence Day Celebrations Amid Renewed Transatlantic Focus
United Kingdom Moves to Attract AI Firm Anthropic Amid Tensions with US Defense Officials
RAF Intercepts Iranian Drones in Middle East to Defend Allied Security Interests
Labour Signals Shift on Foie Gras and Fur Restrictions to Advance EU Trade Talks
Seven Arrested Near RAF Base as UK Authorities Respond to Protest Activity
Economic Pressures Mount as Analysts Warn UK Growth Is Being Constrained by Policy Burdens
UK Green Party’s Push for Church-State Separation Sparks Debate Over National Identity
Strategic Island Emerges as Growing Challenge for United States and United Kingdom Defense Planning
Pepsi Pulls Sponsorship from UK Festival Following Backlash Linked to Kanye West
Signs Emerge of Declining Enthusiasm for Social Media in the United Kingdom
Security Alert Raised Ahead of Meghan Markle’s Planned Visit to Australia
UK Food Halls Defy Hospitality Slowdown, Emerging as Bright Spot in Challenging Market
UK Sets Firm Conditions for Military Action, Insisting on Legal Mandate and Clear Strategy
UK Medicines Regulator Launches Probe into Peptide Clinics Over Health Claims
New North Sea Drilling Unlikely to Significantly Cut UK Gas Imports, Analysis Finds
×