Shell wants to exit equity partnerships held with Gazprom entities

Global oil and gas major Shell announced on Monday its plan to exit its joint ventures with Russia’s Gazprom and related entities.

These exits, the company said, includes its 27.5 percent stake in the Sakhalin-II liquefied natural gas facility, its 50 percent stake in the Salym Petroleum Development and the Gydan energy venture. 

The oil and gas giant said it intends to end its involvement in the Nord Stream 2 pipeline project as well.

“We are shocked by the loss of life in Ukraine, which we deplore, resulting from a senseless act of military aggression which threatens European security,” said Shell’s chief executive officer, Ben van Beurden.

“We cannot – and we will not – stand by. Our immediate focus is the safety of our people in Ukraine and supporting our people in Russia. In discussion with governments around the world, we will also work through the detailed business implications, including the importance of secure energy supplies to Europe and other markets, in compliance with relevant sanctions,” added Beurden.

By the end of last year,  Shell had around US $3 billion in non-current assets in these ventures in Russia. 

The company said they expect their decision to exit Russia will impact the book value of Shell’s Russia assets and lead to impairments.