Shell joins BP and Equinor in quitting Russian assets
Quantum Commodity Intelligence – BP will sell its 20% stake in Rosneft while Shell and Equinor will end their Russian joint ventures as energy companies pare back from Russian investments after government pressure following the country's invasion of Ukraine, all three companies said.
British oil major BP said it will take a financial hit of up to $25 billion to liquidate its stake in oil producer Rosneft, with CEO Bernard Looney and his predecessor Bob Dudley both resigning from the Russian company's board on Sunday evening.
"This military action represents a fundamental change. It has led the BP board to conclude, after a thorough process, that our involvement with Rosneft, a state-owned enterprise, simply cannot continue," BP's chair Helge Lund said in a statement.
BP was the second-largest shareholder in Rosneft after the Russian state and held the 19.75% share since 2013 when the Russian state bought out part of BP's TNK-BP Russian joint venture.
Meanwhile, London-listed Shell said Monday after the market closed it would exit joint ventures in Russia worth $3 billion, including the sale of its minority stake in the Sakhalin-II LNG facility, its 50% stake in the Salym development and its 10% stake in the Nord Stream 2 pipeline project.
Both companies had come under mounting pressure by the UK government to revise their interests in Russia after President Putin ordered his forces to attack Ukraine.
BP's share price slumped by nearly 7% early morning to a one-year low of £351.10 ($470.50) per share before retracing some losses. They were down 5% at market close.
Equinor follows
Norwegian Equinor followed BP, putting out a statement on Sunday, saying it had decided to stop new investments into Russia and it had started the process of exiting Russian joint ventures.
The Norwegian energy giant – which produced around 2.07 million boepd in 2020 – cooperates with Rosneft in the heavy oil and gas field of North Komsomolskoye in West Siberia and the North Danilovsky field in Eastern Siberia.
"In the current situation, we regard our position as untenable," Anders Opedal, Equinor's CEO, said.
Equinor has been active in Russia in the past three decades and has cooperated with Rosneft since 2012. It holds about $1.2 billion in non-current assets in Russia, with its decision said to impact its book vale and lead to impairments.
The share price of Equinor – 67% owned by the Norwegian state – fell to a low of NOK276.6 ($31.15) before rebounding to a one-week high of NOK284.35.
