Equinor joins BP in exit of Russian projects

Norwegian energy major Equinor today announced it will start the process of exiting its joint ventures in Russia and halt any new investments in the nation, due to what the group says is an “untenable” position in light of President Putin’s invasion of Ukraine.  

The group has operated in Russia for 30 years. In partnership with Russian oil giant Rosneft, Equinor worked at the Kharyaga oil field near the Arctic Circle, with an output of 30,000 barrels per day.  

At the end of 2021, Equinor had $1.2bn in non-current assets in Russia.

In a statement, Equinor CEO Anders Opedal said the group was “deeply troubled” by the invasion of Ukraine, adding that it will comply with any sanctions put in place by the EU, Norway and the United States if relevant to its operations.  

“[This] represents a terrible setback for the world, and we are thinking of all those who are suffering because of the military action,” he said. “In the current situation, we regard our position as untenable. We will now stop new investments into our Russian business, and we will start the process of exiting our joint ventures in a manner that is consistent with our values. Our top priority in this difficult situation is the safety and security of our people.”

Equinor has also said it will announce a financial contribution to humanitarian efforts in Ukraine “early this week”.  

The Norwegian group follows the likes of BP, which today revealed plans to sell its nearly 20% stake in Rosneft following Putin’s invasion. BP CEO Bernard Looney said the move was “the right thing to do”.

For both majors, the move will mean a value loss. BP has already seen a 7% hit to shares after its announcement, and Equinor says it anticipates “impairments”.

Other oil majors are also seeing pressure to similarly back out of any Russian ventures in solidarity with Ukraine. UK shadow secretary of state Ed Miliband tweeted that Shell, which has a 27.5% share in Gazprom’s Sakhalin-2 offshore gas project should “divest their Russian holdings to isolate the Putin regime”.

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