Houston – Exxon Mobil said on Tuesday it would end its involvement in a major oil and gas project in Russia, becoming the last Western oil company to announce its departure after Russia invaded Ukraine.
Exxon is developing three oil and gas fields near the eastern Russian island of Sakhalin in partnership with Rosneft, a state-controlled energy company, and one each from Japan and India. Exxon manages the fields and owns 30 percent of the project, which generates about 2 percent of the company’s global production.
The Texas-based company has been operating in Russia for a quarter of a century, but began shutting down after Russia invaded and annexed Crimea, part of Ukraine, in 2014, triggering Western sanctions.
BP and Shell have announced plans to sell their much larger Russian investments on Sunday and Monday. TotalEnergies of France said on Tuesday it would not invest more money in Russia, but intends to maintain its existing operations and investments in the country.
The decisions of Exxon, BP and Shell put an end to an era that began with the mass influx of Western companies into Russia at the end of the Cold War. Businesses once hope that the country, which has some of the world’s largest reserves of oil, natural gas and other raw materials, will become a promising emerging market. But President Vladimir Putin’s autocratic policies and invasion of Ukraine have turned Russia into a pariah of the international business community.
Among the major international oil companies, Equinor of Norway still produces a relatively modest 30,000 barrels of oil a day in Russia, and said Monday it also plans to leave. Several other companies have stakes in oil and gas pipelines.
“Exxon Mobil supports the people of Ukraine as they seek to defend their freedom and determine their own future,” the company said in a statement. “In response to recent events, we are beginning the process of terminating operations and developing steps to exit the Sakhalin-1 initiative.
The company said it would not make new investments in Russia, although it would not leave the country immediately.
“As an operator of Sakhalin-1, we have an obligation to ensure the safety of people, the environment and the integrity of operations,” the company said. “Our role as an operator goes beyond capital investment. The termination process will need to be carefully managed and closely coordinated with the partners to ensure that it is carried out safely. “