HomeUncategorizedShell still trading Russian gas despite pledge to stop

Shell still trading Russian gas despite pledge to stop

  • By King Ben
  • Business reporter, BBC News

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The tanker Nikolay Zubov LNG, docked in the UK in 2021

Shell remains in the Russian gas business more than a year after pledging to withdraw from the Russian energy market.

According to analysis from campaign group Global Witness, the company was involved in nearly one-eighth of Russia’s gas exports by ship in 2022.

Oleg Usenko, an adviser to Ukrainian President Vladimir Zelensky, accused Shell of receiving “blood money”.

Shell said the transactions were the result of “long-term contractual commitments” and did not violate the law or sanctions.

Just as recently on May 9, a giant oil tanker capable of carrying more than 160,000 cubic meters of compressed gas into liquid form – liquefied natural gas or LNG – left the port of Sabetta, on the Yamal peninsula in the far north of the country. Russia.

Such goods were purchased by Shell prior to its arrival at its final destination, Hong Kong.

This is one of eight LNG shipments that Shell has purchased from Yamal this year, according to data from the Kpler database analyzed by Global Witness.

Last year, Shell accounted for 12% of Russia’s seaborne LNG trade, Global Witness calculates, and was among the top five Russian-sourced LNG traders that year.

It said it would stop buying Russian oil, selling service stations and other businesses in Russia, and begin a “phased withdrawal from Russian oil, gas and LNG products.” “. But it warned that would be a “complicated challenge”.

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Shell said last year it would close all of its service stations in Russia

Since then, it has continued to receive LNG cargoes from two Russian ports, one in Yamal and one at Sakhalin in the far east.

Shell used to be a minority investor in the Sakhalin gas project, but waived that claim last September after the Russian government transferred its stake to a local business – and has not since. receive gas from Sakhalin.

But it still honors its contract with Russian LNG company Novatek, which forces it to buy 900,000 tonnes a year from Yamal until the 2030s, according to Reuters news agency.

Novatek is Russia’s second-largest gas company, and the taxes it pays are a significant contribution to the Russian government’s budget.

“It’s quite simple: by continuing to trade in Russian gas, Shell is putting money in Putin’s pocket and helping to finance his brutal invasion of Russia,” said Oleg Usenko, an adviser to the Ukrainian president. Russia to the Ukrainian people.

“The huge amount of money that Shell and the entire oil industry have made in Russia should be used to help finance the reconstruction of Ukraine, rather than lining the pockets of their shareholders.”

A Shell spokesperson said: “Shell has stopped buying Russian LNG on the spot market, but still has some long-term contractual commitments. This is fully compliant with existing sanctions, laws and regulations. practices of the countries in which we operate.

“There is a dilemma between putting pressure on the Russian government for its atrocities in Ukraine and ensuring a stable, secure energy supply. Governments must decide on the blows. extremely difficult change to make.”

Shell is the world’s largest LNG trader, which is not subject to European sanctions, making billions of dollars in profits from its oil and gas business last year.

Russia massively reduced its gas supply by pipeline last year, but it has increased its gas supply by ship, including to Europe.

The UK has not imported any Russian gas for more than a year, while EU politicians are trying to reduce the amount of Russian LNG it imports. In March, EU Energy Commissioner Kadri Simson called on countries and companies to stop buying Russian gas and not sign new contracts.

“It’s been too long for Russia’s LNG trade to be seen as as disgusting as Russia’s oil trade. Targeting Putin’s energy income cannot be symbolic measures but must be prevented in a way specifically the huge amounts of fossil fuels that underpin his power,” he said. Jonathan Noronha-Gant, senior campaigner at Global Witness.

France-based energy company TotalEnergies is a minority shareholder in the Yamal project and also a major player in Russian LNG, Global Witness analysis reported.

The BBC has reached out to TotalEnergies for comment.


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