Exxon Mobil (NYSE:XOM) said Monday it has left Russia completely after Vladimir Putin expropriated its properties following seven months of discussions over an orderly transfer of its 30% stake in the Sakhalin-1 oil and gas project, its largest in the country.
Exxon (XOM) said it exited Russia after the government earlier this month “unilaterally terminated” its interests in the project, although it has not said if it received any compensation for the assets, which it had valued at more than $4B, or if it will contest the seizure through an international arbitration process.
Reuters said the harsh language of Exxon’s (XOM) formal exit shows a desired outcome for the company – leaving Russia – but in unfriendly terms that could translate in multiyear legal disputes, starting with arbitration in European courts.
The project collapsed following Exxon’s (XOM) refusal to accept local insurance for tankers after Western insurers pulled out due to sanctions, according to Reuters.
In April, Exxon (XOM) disclosed a $3.4B writedown on the Russia exit and this month signaled a Q3 $600M impairment charge for unidentified assets.
Exxon Mobil (XOM) is one of the “best anti-inflation and catalyst-rich oil picks” Envision Research writes in an analysis posted recently on Seeking Alpha.
