U.S. rejects Exxon Mobil bid for Russian Federation waiver

The State Department is among the USA government agencies that have a say on Exxon's waiver application, which was made to the Treasury Department's Office of Foreign Assets Control, according to current and former us officials.

The Department of the Treasury, in consultation with President Donald Trump, announced it was rejecting waiver requests from Exxon and other companies looking to restart Russian operations disrupted by global sanctions.

The waiver request has drawn particularly sharp scrutiny for the fact that Exxon's drilling plan, a proposed joint venture with Russia's state-run oil company PAO Rosneft, was hatched during Tillerson's tenure running the ship. While at Exxon, he cultivated close ties with Rosneft and Russian officials including President Vladimir Putin, and he spoke against sanctions that were imposed in 2014 in response to Russia's annexation of the Crimea region of Ukraine.

The deal, between the world's largest listed oil firm and the world's top oil producing nation, was the product of almost a year of talks but was halted by sanctions that the U.S. Treasury placed on Russia, Rosneft and Rosneft CEO Igor Sechin in the wake of Russia's invasion of Ukraine and seizure of Crimea.

Some Republicans in Congress, as well as some European allies, are also anxious about any sign that the Trump administration might ease some of the sanctions imposed on Russian Federation. Specifically, to proceed in the Black Sea.

Throughout the campaign season, US President Donald Trump advocated improving relations with Russian Federation. Exxon's request was floated in 2015 and renewed in March, according to a person familiar with the matter.

"I hope that American companies and the Trump administration will keep these broader implications in mind as they consider any waiver requests, regardless of Exxon's longstanding record of lobbying against these sanctions", he said.

Exxon under Tillerson opposed Obama administration sanctions on Russian Federation, arguing they were not properly issued.

Tillerson, who left Exxon in January to become Secretary of State, has vowed to recuse himself from any issues related to the company for two years.

Rosneft was also to get 30% stakes in Exxon-led projects to develop hard-to-recover reserves in West Texas, the Canadian province of Alberta and the U.S. Gulf of Mexico.

At a 2014 Exxon annual meeting, Tillerson as CEO said, "We do not support sanctions, generally, because we don't find them to be effective unless they are very well implemented comprehensively, and that's a very hard thing to do".

The sanctions scuttled an exploration deal Exxon signed with Rosneft in 2012.

Due to the United States sanctions, ExxonMobil was forced to withdraw its activities in Russian Federation, with the exception of the Sakhalin-1 project.

ExxonMobil appealed to the US Treasury Department with a request to remove restrictions on drilling operations to its joint venture with Rosneft. As of yet, Exxon Mobil has declined to comment on the reports.

  • Zachary Reyes