iMetal

Norway’s Equinor has finished the transfer of its minority stakes in joint ventures (JVs) with Rosneft to the state-owned Russian major, as well as signing off on an agreement to exit it’s 30% share of the Kharyaga production-sharing agreement (PSA) operated by another Russian state-owned oil producer, Zarubezhneftegaz.
The agreements effectively end Equinor’s (previously Statoil’s) more than 30-year presence in Russia, releasing it “from all future commitments and obligations” to any of its former Russian partners, according to a press release issued by the company on 25 May.
Equinor joined Shell and BP in announcing on 27 February their intent to sever business ties with Russia, 3 days after Russian troops had crossed the border into Ukraine. On 2 March, ExxonMobil followed suit and has since declared force majeure on its Sakhalin 1 project with Rosneft, India’s ONGC, and Japan’s SODECO.
Equinor announced an impairment of $1.08 billion on its balance sheet as of 31 March 2022, a move that Equinor’s President and CEO Anders Opedal had predicted in February when he noted that the company’s departure from Russia would “impact the book value” of the $1.2 billion in noncurrent assets it held in Russia at yearend 2021 and “lead to impairments.”
Equinor’s oldest project in Russia was the Kharyaga PSA which it farmed into in 1996 as Statoil. Russia’s state-owned Zarubezhneftegaz operates Kharyaga in the Timan-Pechora basin 60 km from the Arctic Circle.
The Kharyaga PSA license provided Equinor an equity production of approximately 10,000 B/D for its 30% share; Russia’s state-owned Zarubezhneft held 40% at the time of Equinor’s exit; France’s TotalEnergies holds 20%; and Nenets Oil Company, 10%.
TotalEnergies has so far retained its interests in Russia and remains a partner with Zarubezhneftegaz in Kharyaga, although it has stated it will not be making any new investments in Russia.