CI VIEW: US Senator Murkowski says too early to talk about sanctions on Exxon/Rosneft, favors effort to help Poland Update: Comments from ExxonMobil CEO Rex Tillerson

 

HOUSTON/WASHINGTON (CI Ukraine) (Update on March 13, 2015 with comments from ExxonMobil (NYSE: XOM) CEO Rex W. Tillerson) US Senator Lisa Murkowski (R-Alaska), the ranking member of the Senate Energy Committee, said it was too early to speak about taking action on the wide ranging accords signed between US oil giant Exxon Mobil Corp (NYSE: XOM) and Russia’s Rosneft (MCX: ROSN).

[US Senator Lisa Murkowski (R-Alaska) speaks to Capitol Intelligence using CI Glass at IHS Ceraweek in Houston on March 3, 2014]

Speaking to Capitol Intelligence at the IHS CERAWEEK in Houston, Sen. Murkowski said current situation between Ukraine and Russia remains extremely volatile but warned that Exxon should proceed with “caution” in regards with its dealings with Rosneft.

Delegates at the major gathering of oil executives and ministers in Houston were speculating that the US administration is planning to put pressure on Exxon to postpone or even cancel wide ranging agreements made with Rosneft regarding Arctic drilling, developing shale fields in Siberia, and building a natural-gas export terminal in Russia’s Far East.

The agreements signed between Exxon Chief Executive Rex W. Tillerson and Rosneft CEO Igor Sechin were highlighted by the Kremlin as proof that the listed state-owned Russian oil group has become a major international oil company in its own right.

Speaking to Capitol Intelligence/CI Urkaine following a speech at the Economic Club of Washington on March 12, 2015, ExxonMobil’s Tillerson said the company has a maximum exposure of USD 1bn from sanctions related to its joint ventures with Rosneft.

[ExxonMobil CEO Rex Tillerson press gaggle covered by Capitol Intelligence/CI Ukraine using Google Glass at Economic Club of Washington, DC. March 12, 2015]

Tillerson said he does not believe that Rosneft will find another partners to develop arctic drilling in Russia and noted Exxon’s 25-year relationship with the Russian NOC.

He also said that the sanctions have not affected its off-shore drilling operations on the Sakahlin islands and that the company is in fact expanding exploration and production in Russia’s Far East.

 

After taking over BP’s TNK- BP joint venture with Access Industries controlled by Russian businessmen Viktor Vekselberg, Leonard Blavatnik and Mikhail Fridman earlier this year, Rosneft now produces 5 percent of the world’s oil.

Igor Sechin is considered one of the closest collaborators to Russian President Vladimir Putin and a likely target for any eventual sanctions threatened by US Secretary of State John Kerry surrounding the Crimea conflict, a US diplomatic source said.

Murkowski said she supportis efforts by Poland to become energy independent.  She said the plan by Polska Grupa Energetyczna (PGE) — Poland’s largest listed power group — to build a nuclear power plant with either technology from GE/Hitachi or Westinghouse/Toshiba,  is a positive development.

The Warsaw offices of New York law firm Weil, Gothshal & Manges is representing GE on the proposed nuclear plant, Weil partner Roman Rewald said.

US Secretary of Energy Ernest Moniz said one of the US government’s main priorities is to help bring energy independence to Eastern and Central Europe. Responding to a question from Capitol Intelliegence, Moniz said the current political unrest surrounding Ukraine will most probably accelerate initiatives such as the planned export of natural gas from the United States.

He also said that the US Energy Department is planning to provide advocacy support regarding the development of nuclear power in the Czech Republic and Bulgaria. He was not able to immediately comment regarding support for nuclear power in Poland.

Murkowski also said she supports the development of shale energy development in Poland and welcomes efforts by ConocoPhillips (NYSE: COP) to revive efforst to develop shale oil and gas in the central European country.

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By PK Semler in Houston, Texas.  For more information please call +1-202-549-3399 or email pks@capitolintelgroup.com