Trump won’t issue drilling waivers to Russia sanctions
The administration of US President Donald Trump will not allow any American companies to drill for oil in Russia, the Treasury Department announces.
The announcement came on Friday after Exxon Mobil Corporation, an American multinational oil and gas corporation, had sought a waiver to resume a joint venture with Rosneft, the Russian state oil company.
"In consultation with President Donald J. Trump, the Treasury Department will not be issuing waivers to US companies, including Exxon, authorizing drilling prohibited by current Russian sanctions," Treasury Secretary Steven Mnuchin said in a statement.
On Wednesday, the Wall Street Journal reported that ExxonMobil had filed its waiver request during the administration of former President Barack Obama when the company’s CEO was Rex Tillerson, who is now Trump’s secretary of state.
The company sought to resume oil drilling in several areas of the Black Sea banned by US sanctions on Russia.
Before joining the Trump administration, Tillerson established close ties with Rosneft and Russian officials including President Vladimir Putin.
He also voiced his opposition to sanctions that were imposed in 2014 in response to what the US called Russia’s annexation of the Crimea region of Ukraine, an accusation that has been flatly rejected by Moscow.
The US sanctions prohibit US oil companies from providing Russia with the advanced technology used to drill more efficiently offshore and in shale formations.
Exxon argues it could lose its contractual exploration rights in the Black Sea resulting in losses of up to $1 billion, if it did not resume drilling operations by the end of 2017.
This will provide a chance for European companies, particularly Eni, the Italian oil and gas giant, to pick up the work.
Last June, Zeljko Runje, Rosneft’s vice president for offshore projects, said, “We are going to drill with Eni next year. That is our plan. On the Black Sea.”
In August 2011, Exxon and Rosneft signed a strategic partnership deal according to which the two companies agreed to invest $3.2 billion in exploration in the Arctic Ocean and the Black Sea, in an area known as the Tuapse Trough license block.
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