Page 12 - FSUOGM Week 28 2022

FSUOGM INVESTMENT FSUOGM

Trafigura offloads stake in Vostok Oil

megaproject in Russian Arctic

RUSSIA GLOBAL commodities trader Trafigura has the country’s oil sector, and even investors from
sold its 10% stake in Russia’s Arctic megapro- countries not aligned with Western sanctions
Trafigura joined the ject Vostok Oil to Hong Kong-based Nord Axis, against Moscow have shown reluctance to take
project in 2020, and Trafigura said in a statement on July 13, without their place.
has had to strike off its revealing the deal’s terms. Trafigura closed the purchase of a 10% inter-
investments. “Following a review of options in respect of est in Vostok Oil in December 2020, initially
its 10% non-operational, passive shareholding in investing €1.5bn ($1.6bn) of its own equity in
Vostok Oil, Trafigura has now exited its invest- the deal, which included crude offtake commit-
ment,” the company said. “Trafigura’s share- ments. Days after Moscow launched its invasion
holding in Vostok Oil, including the associated of Ukraine, Trafigura said it was reviewing its
non-recourse bank debt, have been acquired by shareholding in the project, and in late April,
Nord Axis Limited, an independent Hong Kong it said it would cease all oil purchases from
registered trading company.” Rosneft as soon as tighter EU rules on Russian
Vostok Oil, operated by state-owned Rosneft, crude sales came into effect. CEO Jeremy Weir
comprises several large-sized oilfields in Rus- estimates Trafigura’s Russian business accounted
sia’s far north that hold a combined 6bn tonnes for 6% of its total.
(44bn) barrels of oil and substantial gas reserves. Trafigura said in mid-June it had completely
Rosneft says this is enough to support 2mn bar- written down its investments in Vostok Oil.
rels per day (bpd) of oil production, and as much Another leading trader Vitol is also planning
as 50mn tonnes per year (tpy) of LNG. The pri- to withdraw from Vostok Oil, and is “in the pro-
mary target market for these supplies is Asia. cess of completing formalities.” The company
The project’s fate is now up in the air, though. had teamed up with Mercantile & Maritime last
Western oil producers, contractors, equipment year to purchase 5% in the venture. Mercantile &
suppliers and financiers are withdrawing from Maritime is yet to disclose its plans. ™

P12 www. NEWSBASE .com Week 28 13•July•2022