Japan exempts Russian energy projects from sanctions

Japan has excluded from sanctions three Russian energy projects in which Japanese companies are actively participating, according to an announcement posted to the website of the country’s Economy Ministry.

According to the notice, the exemption will cover projects deemed critical to Japan's energy security.

“Service operations, which the Minister of Economy, Trade and Industry has identified as particularly necessary to ensure the energy security of our country, are not subject to the ban,” the ministry stated, adding that the waiver applies to architectural and engineering services related to “exploration, extraction, liquefaction, storage, transportation and transshipment of crude oil and combustible natural gas, as well as operations incidental to these, including Sakhalin 1, Sakhalin 2, and Arctic LNG 2.”

The measure will apply to service operations starting on or after September 30, 2023, according to the announcement. It also exempts from sanctions the provision of services to Russian subsidiaries of Japanese companies.

On May 26, Japan announced plans to ban the provision of architectural and engineering services to Russia, without specifying when the measure would take effect. The country has been aligning its Russia policy with Western states, which have imposed several packages of sanctions against Moscow in recent months in response to the military operation in Ukraine.

Tokyo, however, has been reluctant to sanction the Russian energy sector, and has repeatedly noted its importance for the country’s energy security. Japan received an exemption from the Western price cap on Russian oil imports, which saw supplies from Sakhalin-2 excluded. The country has also kept its stakes in its joint energy projects in Russia.

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