2 Feb 2023 10:54

Shell signs documents with Gazprom Neft on sale of 50% stake in Salym

MOSCOW. Feb 2 (Interfax) - Shell (SPB: RDS.A) has signed documents with Gazprom Neft on the sale of its 50% stake in the Salym Petroleum Development joint venture, which is developing the Salym project in the Khanty-Mansiysk Autonomous District (KhMAD), and approvals are required in the Russian Federation in order to complete the transaction, Shell said in a report.

Shell recalls that it ceased participating in the management of the JV with Gazprom Neft in mid-2022, withdrew its employees from the board of directors, and zeroed out the value of the asset, recognizing a full impairment of $233 million. In accordance with Russian legislative amendments and court decisions, Salym Petroleum Development at the end of 2022 became the Russian Salym Petroleum Development LLC, in which Shell had retained a 50% stake.

"On December 22, 2022, Shell signed documents with Gazprom Neft on the sale of a 50% stake in Salym Petroleum Development LLC. Completion of operations is subject to a number of approvals in the Russian Federation," according to the company's report.

A court earlier had upheld Gazprom Neft's application to remove part of the interim measures from Shell that prohibited the British-Dutch company from selling its stake in Salym Petroleum Development.

Salym is a major mining and exploration project in the Khanty-Mansiysk Autonomous District (KhMAD), which develops the Salym group of oil fields, including West Salym, Upper Salym, Vadelypskoye, Yuzhno-Yamskoi, Vostochno-Shapkinsk, and Salym-2. Recoverable C1+C2 oil reserves total 140 million tonnes in the Salym group of fields, as confirmed by the Russian State Committee on Reserves.

Shell plc had previously announced its intentions to exit all Russian hydrocarbon projects, including oil, petroleum products, gas, and LNG projects, respectively.