A Russian decree signed on December 24 extended the deadline for the sale of Exxon Mobil’s 30% stake in the Sakhalin‑1 offshore oil and gas project to January 1, 2027.
Sakhalin‑1, located off the northeast coast of Sakhalin Island, has been a cornerstone of Exxon’s upstream portfolio. The company originally held a 30% interest, and the sale deadline had been moved from October 2023 to January 1, 2026 before this latest extension.
Exxon announced in March 2022 that it would exit Russia following the invasion of Ukraine, taking a $4.6 billion impairment charge related to Sakhalin‑1. In October 2022, a Russian LLC managed by Rosneft’s subsidiary Sakhalinmorneftegaz‑Shelf replaced Exxon Neftegas Ltd. as the project’s operator, and other foreign partners such as Japan’s SODECO and India’s ONGC have agreed to assume their pro‑rata stakes in the new operator.
The extension reflects ongoing regulatory uncertainty and sanctions‑related complications that have slowed the divestment process. Russia’s August 2025 decree opened a pathway for foreign investors to potentially regain stakes in Sakhalin‑1 if sanctions are lifted and technology supplies are secured, indicating the government’s willingness to accommodate foreign investors under specific conditions.
For Exxon, the additional year provides more time to navigate the complex regulatory environment and assess the feasibility of a future repurchase, while for Russia it keeps the asset on the market and signals a flexible approach to foreign investment amid geopolitical tensions. The move also underscores the broader challenge of divesting Russian assets under sanctions and the potential for a gradual return of foreign participation if diplomatic conditions improve.
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