The contracts with Russia’s biggest oil company Rosneft damaged by the West’s anti-Russian sanctions have cost ExxonMobil $1 billion, the company said in its annual report.
“In 2014, the European Union and United States imposed sanctions relating to the Russian energy sector. In compliance with the sanctions and all general and specific licenses, prohibited activities involving offshore Russia in the Black Sea, Arctic regions, and onshore western Siberia have been wound down. The Corporation's maximum exposure to loss from these joint ventures as of December 31, 2014, is $1.0 billion,” the report said.
Rosneft and ExxonMobil established projects to conduct exploration and research activities in 2013 and 2014. The European Union and United States imposed sanctions relating to the Russian energy sector in 2014, prohibiting any activities that involve offshore work in the Russian Black Sea and Arctic regions, and onshore in western Siberia.
READ MORE:ExxonMobil, Rosneft start joint Arctic drilling in defiance of sanctions
The two companies began an exploration project in the Kara Sea in August despite the sanctions. Oil reserves in the Kara Sea could be as high as 13 billion tons, which is more than in the Gulf of Mexico or the whole of Saudi Arabia.
Another joint venture known as the Sakhalin–1 Consortium in Russia’s Far East uses Berkut, the world’s largest oil platform and is producing 27,000 tons of oil a day.
READ MORE: Biggest oil rig ever: 200k-ton Sakhalin giant begins production
Russia’s Rosneft and its President Igor Sechin have been put under US and EU sanctions. The provision of oil equipment and services such as drilling in offshore deep water projects such as in the Arctic, or shale well drilling were also banned due to the terms of the sanctions.