28 Feb 2023 15:09

Court satisfies Russian Prosecutor General's claim for recovery of Sakhalin-1 tax debt from Exxon Neftegas

YUZHNO-SAKHALINSK/MOSCOW. Feb 28 (Interfax) - The Yuzhno-Sakhalinsk Municipal Court on Tuesday concluded its review of the Russian Prosecutor General's claim against Exxon Neftegas Limited (ENL - formerly the operator of the Sakhalin-1 project) for tax and penalty arrears, the Sakhalin Regional Court press office told Interfax.

"The ruling has been issued. The [General Prosecutor's] claims have been satisfied in full," a spokesperson for the office told Interfax.

The General Prosecutor's Office filed a lawsuit on September 26. Also in late September, the assets of Exxon Neftegas Limited were seized by order of the Yuzhno-Sakhalinsk Municipal Court. The list of assets and other details were not disclosed.

Representatives of the Sakhalin Region government participating in the proceedings explained to Interfax at the end of January that the Prosecutor General's Office originally filed a claim against ENL for just over 15 billion rubles but as of the end of January this sum increased to 15,479,095,200.8 rubles when factoring in accrued interest.

In April 2022, Exxon Neftegas Ltd, the operator of the project, declared a force majeure and began reducing oil production at Sakhalin-1 (Suspension of oil and gas production at the project was reported in September), and later declared its intention to transfer its rights to an unnamed third party. In accordance with a decree from Russian President Vladimir Putin, a company, OOO Sakhalin-1, was registered in Yuzhno-Sakhalinsk on 14 October, which was given the status of the new operator of the PSA project.

Sakhalinmorneftegaz-Shelf received 11.5% in the company's charter capital in proportion to its stake in the PSA, and another 8.5% is managed by JSC RN-Astra. The foreign PSA participants had one month to confirm their consent to receive their proportional shares in the new operator. Japan's SODECO (30%) and India's ONGC (20%) did so, while Exxon Mobil (30%) said it decided to terminate its participation and fully withdraw from Russia.