ExxonMobil boss flies in to Moscow seeking compensation

ExxonMobil President Rex Tillerson flew into Moscow today where he was due to meet with a high-powered delegation including  Russia’s Finance Minister Anton Siluanov, Energy Minister Alexander Novak, Deputy Prime Minister Arkady Dvorkovich and Rosneft President Igor Sechin to discuss a rebate on the tax it has paid on revenues from the Sakhalin- 1 project in Russia’s Far East.
This is not in fact a new demand; the US company raised the issue of lowering the rate of tax it pays in relation to the project from 35%  to 20% six years ago, but has become more pressing in its demands for a rebate that could run into the tens of billions of  roubles since sanctions brought its involvement in the project to a halt last year. Sakhalin-1 is operated on  a production sharing agreement (PSA) involving ExxonMobil (30%), Japan’s Sodeco (30%),  Rosneft (20%) and India’s ONGC 20%. The PSA covers the  Chayvo, Odoptu and A-D oil and gas fields with  combined  p otential recoverable reserves of 307m tons of oil and 485bn m³ of gas.  

Source: Kommersant