Exxon Mobil Scraps a Russian Deal, Stymied by Sanctions
Under the last four years of sanctions, Exxon and other Western oil companies have been prevented
from using their technological expertise to help Rosneft’s oil and gas development.
28, 2018
HOUSTON — Exxon Mobil is abandoning its joint exploration ventures with the Russian oil company Rosneft,
retreating from what was one of its most promising investments until Western sanctions got in the way.
Exxon and Rosneft, which is only half-owned by the Russian government
but state-run, agreed to invest $3.2 billion to search for oil in deepwater fields in the Arctic and elsewhere.
During the early years of the Obama administration, when there was a brief warming
of relations, Exxon Mobil signed an exploration deal with the Russians.
In a regulatory filing on Wednesday, Exxon said that it had decided late last year to
abandon the ventures this year and would take an after-tax loss of $200 million.
"They are an enormous source of friction with the government,
and it is better business for them to steer their business away from sanctioned activities." In July, Exxon sued the Treasury Department after it was fined $2 million for violating the Russia sanctions.