Russia has approved a new legal framework that may allow foreign shareholders to reclaim their stakes in the Sakhalin-1 oil and gas project.
President Vladimir Putin signed Decree No. 559 on August 15, 2025, amending the 2022 order that had transferred the project to a new Russian operator.
According to the text, a foreign party seeking to return must take actions aimed at lifting sanctions that negatively affect the project, sign contracts for the supply of foreign-made equipment and parts, and transfer previously accumulated funds to the project’s accounts.
The decree takes effect upon official publication.
The measure follows earlier steps taken since the 2022 handover. In December 2024 the Kremlin extended the deadline to dispose of ExxonMobil’s unclaimed stake until January 1, 2026.
The current operator, Sakhalin-1 LLC, is managed by Sakhalinmorneftegaz-Shelf, a subsidiary of Rosneft, under a 2022 government resolution.
ExxonMobil previously held a 30 percent operator interest in Sakhalin-1 and exited Russia in 2022. In its financial disclosures that April, the company recorded a $3.4 billion after-tax charge linked to the withdrawal.
Japanese consortium SODECO and India’s ONGC Videsh were allowed to retain their stakes after the 2022 restructuring.
The Sakhalin-1 project is operated under a production-sharing agreement signed in the 1990s and includes the Chayvo, Odoptu and Arkutun-Dagi offshore fields in the Sea of Okhotsk. Crude oil is exported through the De-Kastri terminal to Asian markets.
Analysts note that the decree creates a legal pathway for the return of foreign investors but makes it conditional on sanctions relief and restoration of foreign technology supplies, conditions that remain difficult to meet.
ExxonMobil is a U.S. multinational oil and gas corporation incorporated in New Jersey and headquartered in Irving, Texas.
Rosneft is a Russian public joint stock company majority-owned by the Russian Federation through Rosneftegaz. It is the country’s largest integrated oil producer and operates exploration, production, refining, and marketing activities.
Sakhalinmorneftegaz-Shelf is a limited liability company registered in Russia and a wholly owned subsidiary of Rosneft. It is responsible for offshore oil and gas activities on Sakhalin and manages Sakhalin-1 LLC.
SODECO is a Japanese consortium established as a special-purpose company with participation of the Japanese government and private firms. It holds a minority stake in Sakhalin-1.
ONGC Videsh is the international arm of Oil and Natural Gas Corporation Limited, a public sector company of the Government of India. It holds overseas upstream assets, including a stake in Sakhalin-1.