U.S. Major ExxonMobil Faces $220M Tax Claim from Russia

Tuesday, January 31, 2023

 The Russian General Prosecutor's Office is asking a court to recover 15.5 billion roubles ($220 million) in allegedly unpaid taxes from U.S. oil major ExxonMobil , local news agencies TASS and Interfax reported on Tuesday citing court documents. 

The Sakhalin regional court website lists a claim against Exxon Neftegaz Ltd, ExxonMobil's Russian subsidiary, by the General Prosecutor's Office, without giving further details. Exxon declined to immediately comment. 

The local court declined to disclose further details to Reuters as the company is not a party to the case.

The Russian prosecutor's office did not reply to a request for comment. Exxon last year issued force majeure and abandoned an offshore oil project on the Russian Pacific island of Sakhalin due to Western sanctions imposed on Moscow after it sent troops into Ukraine on what it called a "special military operation". 

Moscow retaliated by blocking foreign investors' assets, in some cases also seizing them. 

After Exxon's exit Moscow established a new entity, managed by a subsidiary of Russian energy giant Rosneft, that owns investor rights in Sakhalin-1 project. The next hearing of the case in Sakhalin is scheduled for Feb. 28, according to the court's web site. 

Exxon took an impairment charge of $4.6 billion on its Russian activities in April. It also reduced local energy production and moved staff out of the country. 

Russia last year approved requests by India's ONGC Videsh, the overseas investment arm of state-run Oil and Natural Gas Corp, and Sakhalin Oil and Gas Development Co (SODECO), a consortium of Japanese firms, to retain their respective 20% and 30% stakes in the Sakhalin project. 

($1 = 70.3800 roubles) 

(Reuters - Reporting by Olesya Astakhova; writing by Vladimir Soldatkin; Editing by Kirsten Donovan)

Categories: Energy Industry News Activity Production Asia Regulations

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