TotalEnergies Sells Siberia Gas Field Stake to Russia’s Novatek

TotalEnergies decided to sell its stake in a Siberian gas field, owned in a joint venture with Russia’s Novatek, to the Russian fossil fuel company. The French energy giant has been criticized for not moving away from its business dealings in Russia. The company has, unlike many of its Western peers, hold onto its Russian assets so far. The company has not revealed what it would do with its 19% stake in Novatek itself, or its other businesses in the country.

Earlier this month, a Russian presidential decree banned investors from “unfriendly countries”, including France, selling stakes in certain energy projects and banks until the end of the year, but it provides for waivers in some cases.

The development will be viewed as a small positive by TotalEnergies’ peers such as BP or Shell, which have been stuck with tens of billions worth of assets in Russia and have struggled to find buyers.,

Regarding the sale of its stake in Terneftegaz, which operates the Termokarstovoye gas and condensates field in Siberia, TotalEnergies said it expected the deal to close in September.

The company said the agreement was made on July 18, 2022, to sell to Novatek TotalEnergies’ 49% interest in Terneftegaz. It added that it had sent Russian authorities a request to approve the deal on Aug. 8 and that it got the green light on Thursday.

It was reported recently that Termokarstovoye gas field is supplying the Russian army. TotalEnergies rejected the claims saying the all of its output was for export purposes.

TotalEnergies decided in July to sell the remaining 20% interest it held in the Kharyaga oil field, in what was its first major divestment in Russia in the wake of Western sanctions over Moscow’s invasion of Ukraine.

It still has minority stakes in a number of non-state-owned Russian companies, such as Novatek (19.4%), Yamal LNG (20%) and Arctic LNG 2 (10%).

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