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US sanctions threaten Shell alliance with Gazprom

10th August 2015

The US government has extended sanctions on Russian to include the Sakhalin 3 project, on which Shell and Gazprom had agreed to work together

As well as a response to the Ukraine crisis, sanctions are seen as a means of influencing global prices
As well as a response to the Ukraine crisis, sanctions are seen as a means of influencing global prices

Royal Dutch Shell’s plans to partner with Gazprom are at risk after US sanctions were extended on Friday, to include one of the Russian producer’s biggest gas fields.

Shell and Gazprom signed an agreement in June to develop a strategic alliance in the gas sector,

Shell revealed last Monday that it had agreed to swap an undisclosed asset with Gazprom for a stake in the Sakhalin-3 project, as part of an alliance between the two companies. 

That alliance is under threat since the US government on Friday added the new Yuzhno-Kirinskoye field, where Sakhalin 3 project is located, to its sanctions list.

As a result, exports and exchanges of technology and equipment will be severely restricted. 

The US government has imposed sanctions on Russia since its military involvement in the Ukraine. 

The strategy of placing sanctions on new fields instead of existing ones is viewed as a means of avoiding spikes in energy prices. 

US sanctions have restrict exploration for shale, Arctic and deepwater oil – and now restrict the new gas exploration activities on Sakhalin island.

 

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