Shell Says Won't Jump Into New Russia Projects Amid Ukraine Crisis



Reuters

MOSCOW, April 30 (Reuters) - Oil majors are beginning to grow cool on new projects in Russia as U.S. and EU sanctions over Moscow's actions in Ukraine make investment increasingly risky and after the Kremlin's threat to review the West's role in Russia's energy industry, the world's largest.

"I don't think we will be jumping into new investments in the short term," Royal Dutch Shell's chief financial officer Simon Henry told a conference call on Wednesday.

The United States and the European Union imposed more sanctions on Russia this week as part of their drive to put pressure on Moscow for the annexation of Crimea and what they see as direct support for pro-Russian separatists that have seized public buildings across eastern Ukraine.

Henry's comment came only weeks after Shell Chief Executive Ben van Beurden visited Russia and met Russian President Vladimir Putin to take part in celebrations marking 20 years of the Sakhalin-2 gas project, one of the biggest foreign direct investments in Russia.

"It was planned a long time ago. I wouldn't read too much into the timing of the visit," said Henry.

BP's Chief Executive Bob Dudley also visited Moscow earlier this month and said the company was "rock solid" with its investment in the country, where it owns a fifth of the Kremlin's national oil champion Rosneft.

However, investors are increasingly worried about the Russian exposure of major oil companies. Rosneft chairman Igor Sechin, a close ally of Putin, was put on the sanctions list this week, but the company, along with state gas behemoth Gazprom and its executives, escaped sanctions for now.


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