Equinor to abandon investments in Russia in response to attack on Ukraine

Norwegian energy company Equinor ASA (NYSE:EQNR) has announced that it will begin exiting its current joint ventures in Russia and give up potential new investments, thus putting an end to its presence of more than 30 years in the country.

"We are all deeply troubled by the invasion of Ukraine, which represents a terrible setback for the world, and we are thinking of all those who are suffering because of the military action," Equinor's president and chief executive, Anders Opedal, said in a statement on Monday. He added that in the current situation the company finds its position in Russia "untenable."

Equinor said that it had non-current assets in Russia worth a total of USD 1.2 billion (EUR 1.1bn) as at the end of 2021. It expects the decision to exit the Russian joint ventures will affect their book value and lead to impairments.

The Norwegian state-controlled company also noted that it has so far complied with Norwegian, European Union (EU) and US sanctions and will continue to do so in regard to any new sanctions that may concern its operations. It will also contribute funding to humanitarian efforts in the region.

Equinor, then known as Statoil, first agreed to begin joint offshore oil and gas exploration with Rosneft in 2012. At the time, the Norwegian company took stakes of 33.33% in four license areas -- Perseevsky in the Barents Sea as well as Kashevarovsky, Lisyansky and Magadan 1 in the Sea of Okhotsk. Its Russian output amounts to 25,000 barrels of oil equivalent per day (boepd).

In December 2020, Equinor bought 49% of Russian onshore petroleum assets operator KrasGeoNaC (KGN) from Rosneft for a consideration of up to USD 550 million.

Last year, Equinor also agreed to cooperate with Rosneft to reduce the carbon footprint from their joint projects and develop low-carbon solutions.

(USD 1 = EUR 0.892)

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