Kremlin launches €1bn raid on Shell
Russia is seeking more than €1bn (£833m) in damages from Shell over its decision to quit the country in the wake of Vladimir Putin’s invasion of Ukraine.
The Russian prosecutor general filed a lawsuit against several Shell entities this month, according to court documents, with a hearing scheduled for Dec 11.
It comes amid a legal battle over Shell’s withdrawal from the country in 2022, which led to it being hit with a $5bn (£3.8bn) write-down on its assets.
Shell’s Russian holdings included a 27.5pc stake in the Sakhalin-2 oil and gas field, where it had invested alongside Russia’s state-owned gas giant Gazprom and Japanese firms Mitsui and Mitsubishi.
It emerged last year, however, that the Russian government had unilaterally seized the joint venture’s assets and transferred them to a domestic entity.
It then offered all parties an equivalent stake in the new business, but Shell objected to the transfer and refused to sign agreements with the new entity.
This prompted Moscow to forcibly sell off Shell’s stake.
A Russian media report at the time claimed that Mr Putin signed off the deal personally, with the holding passing to a company called Novatek and then later a subsidiary of Gazprom.
Shell was paid 94.8bn roubles (£740m) in compensation for the deal, which was deposited into a Russian bank account.
But the company has not recognised the deal and still considers itself the rightful owner of its stake in Sakhalin.
Nevertheless, it has now emerged that prosecutors in Moscow are seeking damages against the British company, although it has not set out reasons for its claim.
Shell previously booked a $1.6bn charge related to Sakhalin-2 in the first quarter of 2022.
A Shell spokesman was contacted for comment.