11 Oct 2024 16:46

Shell's last Russian subsidiary makes decision on liquidation

MOSCOW. Oct 11 (Interfax) - Shell (SPB: RDS.A) NefteGaz Development (V) LLC, part of the British-Dutch company Shell, made a decision on liquidation on October 9, following in the footsteps of Shell's other Russian subsidiary Shell NefteGaz Development LLC, according to the Uniform State Register of Legal Entities.

Shell NefteGaz Development (V) LLC was registered in 2005. Its main activities included the search for, exploration and production of oil, natural gas, condensate and other minerals, while Shell NefteGaz Development LLC provided consultation services for business and management issues. Both companies were 100% owned by Shell EP Russia Investments (V) B.V.

Shell NefteGaz Development LLC is the sole Russian defendant in the lawsuit filed by the Russian Prosecutor General's Office with the Moscow Arbitration Court on October 2. On October 8, it also made a decision on liquidation.

Following the two subsidiaries' closure, Shell's representation in Russia will be limited to a branch of the Dutch Shell Exploration and Prod.Serv.(RF) B.V., which is registered at the same address as the company's subsidiaries and has the same CEO, Tatiana Ivanova. Shell NefteGaz Development LLC has had a separate division in Yuzhno-Sakhalinsk since March 13, 2021.

Shell has not commented on the information about the companies' liquidation or the lawsuit of the Prosecutor General's Office.

The court's press service told Interfax that the lawsuit was filed to recover damages for the non-fulfillment of obligations, without specifying the amount of the claims.

The defendants in the case are Shell Global Solutions International B.V., Shell Exploration and Production Services B.V., Shell NefteGaz Development LLC, Shell international Exploration and Production B.V., Shell Sakhalin Service B.V., Shell Energy Europe Ltd, Shell and Shell Sakhalin Holdings B.V.

The third parties are Gazprom Export LLC, the Russian Energy Ministry, Sakhalin Energy LLC, Sakhalin Energy Investment Company Ltd, and the Sakhalin regional authorities.

So far, only Sakhalin Energy LLC and the Sakhalin regional authorities have filed petitions to examine the case materials.

In 2022, in line with a decree signed by Russian President Vladimir Putin, Sakhalin Energy Investment Company Ltd (Bermuda) was replaced by a Russian LLC. At the time, according to the conditions for setting up the LLC, Gazprom Sakhalin Holding was assigned a 50.00000001% share upon its establishment. The foreign co-owners of the project had to confirm their participation in the new legal entity - Japanese Mitsui & Co., Ltd. (12.5%) and Mitsubishi Corporation (10%) confirmed they would remain in the project, while Shell informed the Russian authorities it would not take part as a co-owner with the new Russian operator.

The foreign partners can receive funds for their share only after determining and offsetting compensation for the damages caused by them during the project's implementation, as well as damage caused to Gazprom by refusing to accept a new payment system for Russian pipeline gas supplies to Europe.