Zelenskyy's adviser calls on Shell to donate $1 billion to Ukraine
Photo: EPA

The Shell Corporation must donate the money it will receive from the sale of its stake in the Russian oil and gas project Sakhalin-2 to the reconstruction of Ukraine, Oleg Ustenko, a freelance adviser to the President of Ukraine, stated in a letter to Shell CEO Wael Sawan, Politico reports.

In early April 2023, the Kommersant newspaper reported that Russian Novatek was preparing to buy Shell's stake in Sakhalin-2, which the British company managed to write off a long time ago, and it would even be allowed to withdraw money abroad.

The value of Shell's stake in the Sakhalin-2 project was approved by the Russian government in December 2022 — 27.50% in the authorized capital of Sakhalin Energy LLC was estimated at 94.8 billion rubles, or about $1.16 billion.

Ustenko believes that Shell should not use this money.

"If completed, this sale would represent the transfer of more than $1 billion in Russian cash into Shell’s accounts. That would be blood money, pure and simple. We call on Shell to put any Russian sale or dividend proceeds to work for the victims of the war — the same war that those assets have fuelled and funded," Ustenko's letter reads.

Shell declined to comment publicly on the matter, but said it has no active business in Russia and is not in talks to sell a stake in Sakhalin-2.

REFERENCE. The Sakhalin-2 project involves the development of two fields on the shelf of Sakhalin Island. A plant for the production of liquefied natural gas operates as part of the project. In 2022, the operator of the Sakhalin Energy project shipped about 11.5 million tons of liquefied gas and 31.5 million barrels of Sakhalin Blend oil.

Participants in the project are Gazprom (50%), Japanese Mitsui and Mitsubishi (12.5% and 10%, respectively), as well as Shell (27.5%), which decided to write off its share.

In May 2022, Shell recognized $3.9 billion in losses as a result of exiting the Russian market, including $1.6 billion from pulling out of the Sakhalin-2 project.