Exxon Mobil CEO Darren Woods has been at the White House discussing a possible return of the oil giant to Russia. At the center of his talks with President Trump has been the resumption of the Sakhalin Island project, Sakhalin-1, long ago abandoned by Exxon, according to a report out of the Wall Street Journal.
The company was reportedly in Alaska, secretly negotiating with Moscow to make its move back into Russia part of the Ukraine peace process. This would explain why Putin told press that more Russian-American deals could happen in the future.
Exxon’s vice chairman, Neil Chapman, led the negotiations on Exxon’s behalf, with the U.S. government agreeing to support the initiative. The company had a massive presence in Russia ever since the fall of the Soviet Union, including Sakhalin-1, a deal struck in 1995, right up until Putin’s invasion of Ukraine.
In the spring of 2022, Exxon sought to sell its 30-percent stake in Sakhalin-1, worth some $4 billion. However, Moscow froze its investment and transferred ownership to a Russian entity later that year.
Sakhalin-2 was also transferred to a domestic operator and encompasses Russia’s first LNG-producing plant. In the wake of Putin’s invasion and Europe’s decision to diversify away from Russian oil, the U.S. picked up the slack. American LNG exports to the continent jumped to comprise nearly 50 percent of total European LNG imports in 2023.
Interestingly, Sakhalin-1 was never directly sanctioned by the U.S., and Sakhalin-2 was exempted from sanctions by both the UK and U.S. governments until the summer of 2024.
A move back into Russian energy may seem surprising, as there has also been talk of upping sanctions on Russia and specifically cutting off its energy revenues. Then again, Trump has also been open about the possible Russian business opportunities that await America if a peace deal in Ukraine can finally be achieved.
