Russia bans Western investors from selling banks, major energy stocks

MOSCOW—Russia has stepped up pressure on a sanctions confrontation with the West by banning so-called unfriendly investors from selling stakes in major energy projects and banks until the end of the year.

Western powers and allies, including Japan, have imposed financial restrictions on Russia since it sent troops to Ukraine in late February. Moscow retaliated by preventing Western corporations and their allies from leaving Russia.

of edict The document, signed by President Vladimir Putin and issued on Friday, allows investors in countries that support sanctions against Russia to enter into product sharing agreements (PSAs), banks, strategic entities and companies that produce energy equipment. , and any other project immediately prohibits the sale of assets. Oil and gas production into coal and nickel.

According to the presidential decree, President Putin can issue special exemptions to proceed with transactions in certain cases, and the government and central bank must draw up a list of banks for Kremlin approval. did not mention the investor by name.

take a hit

The ban covers almost all large financial and energy projects still funded by foreign investors, including the Sakhalin 1 oil and gas project.

On Thursday, Russia’s state oil tycoon Rosneft accused Exxon Mobil of slowing production at the Sakhalin-1 group’s oil fields. After the US energy giant said it was in the process of transferring its 30% stake to “another party.”

Sakhalin 2 project
General view of the Sakhalin-2 project liquefied gas plant in Prigorodnoye, about 70 km (44 miles) south of Yuzhno-Sakhalinsk, October 13, 2006. (Sergei Karpukhin/Reuters)

Separately, a government decree signed on 2 August stipulated that foreign investors in the Sakhalin 2 liquefied natural gas (LNG) project (Royal Dutch Shell and Japanese trading houses Mitsui & Co. and Mitsubishi Corporation) could I was able to claim my shares within a month. A new entity that replaces the existing project.

The new decree does not cover the Sakhalin 2 project, it said.

Shell was looking for options to withdraw from the project, but the Japanese government reiterated that it wanted Japanese companies to keep their stakes there.

Italy’s UniCredit and Intesa, US group Citi and Austria’s Raiffeisen continue to explore options for exiting Russia, while the likes of Societe Generale and HSBC have found an exit.

Citigroup declined to comment on Friday, but on Thursday the bank said in a filing that it would continue to reduce its operations and exposure to Russia.

Citigroup said it had stopped new business and solicitation of new customers in Russia.

Citigroup disclosed exposure to Russia of $8.4 billion as of June 30, compared with $7.9 billion at the end of the first quarter. Exposure increased due to the appreciation of the ruble.