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Oil giant Shell withdraws from joint ventures with Russian

Shell becomes the latest company to withdraw all of its joint ventures with Russian state-backed Gazprom, just a day after rival BP said it would abandon the 19.75 percent holding in the wake of the invasion of Ukraine.

The oil titan announced it will end its joint ventures with Gazprom and related entities, and quit the Sakhalin 2 liquefied natural gas (LNG) plant by selling its 27.5 percent stake.

Shell also said it will quit their 50 percent stake in the Salym Petroleum Development and the Gydan energy venture, owned and operated by Russian gas giant Gazprom.

Sakhalin 2, located off Russia’s northeastern coast, is one of the world’s largest integrated, export-oriented, oil and gas projects, as well as Russia’s first offshore gas project – producing around 11.5 million tonnes of LNG per year.

Shell, whose Russian assets were reportedly valued at $3 billion at the end of last year, also said it will stop working on the controversial Nord Stream 2 pipeline project, which was completed last September.

The oil giant have reportedly invested an estimated £750 million in the 750-mile pipeline – designed to double the amount of natural gas flowing through the Baltic Sea pipe from Russia to Germany.

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However in the wake of Russia’s invasion of Ukraine, Germany said it was halting final certification of the gas pipeline from regulators in further sanctions to the country.

The announcement was made on Monday following crucial talks between Shell chief executive Ben van Beurden and the Business Secretary Kwasi Kwarteng.

This move comes just a day after rival oil giant BP ditched a stake in Russian energy giant Rosneft following the conflict triggered by President Vladimir Putin’s assault on Ukraine.

It was announced that following the move, BP shares slumped more than 4 percent on Monday as it faces a $25 billion hit.

The oil company saw a huge chunk wiped off its value following the announcement about abandoning the 19.75 percent holding in the wake of the invasion of Ukraine.

The punishment came as the FTSE 100 index fell 1 percent early trading as the markets digested the huge sanctions package being imposed by the West.

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