Thursday, February 9

Exxon is quitting its last oil and gas project in Russia

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Russian President Vladimir Putin has a video conference with the Berkut offshore drilling platform launched in the Sea of Okhotsk as part of the Sakhalin-1 oil and gas project, in Moscow, Russia, Friday, June 27, 2014.

ExxonMobil pledged Tuesday to leave its last remaining oil-and-gas project in Russia, and not to invest in new developments in the oil-rich nation.

By moving to discontinue its Sakhalin-1 project in Russia, Exxon joins a growing list of Western companies including Apple, Ford and General Motors distancing themselves from Moscow. A series of major energy companies, including BP and Shell, have similarly moved to leave Russia.

“ExxonMobil supports the people of Ukraine as they seek to defend their freedom and determine their own future as a nation,” Exxon said in a statement. “We deplore Russia’s military action that violates the territorial integrity of Ukraine and endangers its people.”

The last project: The Sakhalin-1 project is described as one of the largest single international direct investments in Russia, according to the project’s website. Exxon Neftegas Limited, an Exxon subsidiary, has a 30% stake and serves as the operator. Russia’s Rosneft also owns a stake.

An Exxon spokesperson confirmed to CNN that this is the company’s last remaining Russian project. By quitting this project, Exxon would end more than a quarter-century of continuing business presence in Russia.

Exxon, the largest US oil company, was a glaring omission among the big brands cutting ties with Russia. The company operates the Sakhalin-1 project on behalf of a consortium that includes Russian, Japanese and Indian companies.

The company did not detail the financial toll of unwinding a project it has sunk considerable resources into over the years. 

Exxon signaled this will not be done overnight, saying it has an obligation to ensure the safety of the people and environment as it quits the project.

“The process to discontinue operations will need to be carefully managed and closely coordinated with the co-venturers in order to ensure it is executed safely,” Exxon said.

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