Putin approves purchase of Shell stake in Salym project by Gazprom Neft subsidiary

Russian President Vladimir Putin signed a decree that allows “Gazprom oil” to acquire shares of the British energy company Shell in the projects “Salym Petroleum” and “Khanty-Mansiysk Oil and Gas Union” (KhMNS). The document was published on the evening of February 17th.

As follows from the order on the “special decision to conclude transactions” LLC “GPN-Middle East Projects” (a subsidiary of “Gazprom oil)”, the company may acquire 50% of the ordinary shares of CJSC Khanty-Mansiysk Oil and Gas Union, owned by Shell Exploration and Production (LXVI) Bv). The Russian company will also receive a 50% stake in the authorized capital of Salym Petroleum Development LLC, which is owned by SHELL Salym Development BV

“For the transactions specified in this order, it is not required to obtain other permits, decisions, consents (prior consents), approvals (preliminary approvals) and other permits (permits) provided for by the legislation of the Russian Federation,” the document says.

At the end of December last year, Shell agreed With “Gazprom Neft” on the sale of its share in the joint venture (JV) Salym Development LLC. In July “Gazprom Neft” filed an application for the transfer of a joint venture from Shell to Russian jurisdiction and the transformation of Salym Petroleum Development NV into Salym Development LLC with an authorized capital of 8.6 million rubles, in August the court granted it, Vedomosti wrote.

The Salym Petroleum Development joint venture is developing the Salymskoye field in the Khanty-Mansiysk Autonomous Okrug in Western Siberia. Production at the field is about 6 million tons per year. Salym Petroleum is one of the oldest oil and gas joint ventures in Russia, established in 1996. It owns six licenses for the fields of the Salym group. Gazprom Neft entered the capital of the joint venture in the late 2000s.

Shell announced its decision to withdraw from Russian projects after the start of the NWO in Ukraine. In a report dated July 28, 2022, the company announced that its representatives left the board of directors of Salym Petroleum Development NV. After that, joint control of the JV was lost, and from that moment Salym is accounted for by the company “as an asset with a zero carrying value.”