View all newsletters
Receive our newsletter – data, insights and analysis delivered to you
  1. News
May 27, 2022

Shell looking to sell stake in Russian LNG plant to Indian consortium

ONGC Videsh and GAIL are said to be competing to acquire Shell’s stake in the Sakhalin-2 LNG plant.

Shell is holding negotiations to sell its stake in the Sakhalin-2 liquefied natural gas (LNG) plant in Russia to a consortium of Indian energy companies, including ONGC Videsh and GAIL, reported Reuters, citing three sources.

The sale of the 27.5% stake in the LNG plant, which is located on Russia’s eastern flank, comes as the oil firm intends to exit its operations in Russia in the wake of its invasion of Ukraine.

Following its decision to withdraw from all Russian hydrocarbons, Shell took post-tax charges of $3.9bn.

In addition to ONGC Videsh and GAIL, Shell has also urged other state-run companies to bid for the long-term LNG cargoes and crude oil supply deals it has with the Sakhalin-2 project, the sources added.

A potential sale would be subject to approval by Russian authorities, the sources said.

One of the sources said that Shell has currently stopped talks with other companies, including Chinese energy firms, regarding the Sakhalin-2 stake sale.

Last month, Reuters reported that the Indian government urged its state-run energy firms to consider acquiring assets in Russia from European energy majors, including BP.

Russian gas company Gazprom operates the Sakhalin-2 LNG plant with a 50% stake. Other partners in the project include Japan’s Mitsui & Co (12.5%), and Mitsubishi (10%).

There is no certainty that a sale deal would be signed by Shell with the Indian consortium.

Shell recently divested its retail stations and lubricants business in Russia, Shell Neft LLC, to Russia’s Lukoil.

Shell’s Russian retail and lubricants assets include the filling stations primarily located in the Central and Northwestern federal districts of Russia, and the lubricants blending plant located in the Tver region.

Related Companies

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Friday. The industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy


Thank you for subscribing to Offshore Technology