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Shell still trading Russian gas despite pledge to stop

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Shell still trading Russian gas despite pledge to stop

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The Nikolay Zubov LNG tankerPicture supply, Alamy

Picture caption,

The Nikolay Zubov LNG tanker, docking within the UK in 2021

By Ben King

Enterprise reporter, BBC Information

Shell remains to be buying and selling Russian fuel greater than a 12 months after pledging to withdraw from the Russian vitality market.

The corporate was concerned in practically an eighth of Russia’s shipborne fuel exports in 2022, in keeping with evaluation from marketing campaign group International Witness.

Oleg Ustenko, an adviser to Ukrainian President Vladimir Zelensky, accused Shell of accepting “blood cash”.

Shell mentioned the trades had been the results of “long-term contractual commitments” and don’t violate legal guidelines or sanctions.

As lately as 9 Could, an enormous tanker able to carrying greater than 160,000 cubic metres of fuel compressed into liquid type – liquefied pure fuel or LNG – pulled out of the port of Sabetta, on the Yamal peninsula in Russia’s far north.

That cargo was bought by Shell earlier than heading onwards to its final vacation spot, Hong Kong.

It’s certainly one of eight LNG cargoes that Shell has purchased from Yamal this 12 months, in keeping with knowledge from the Kpler database analysed by International Witness.

Final 12 months Shell accounted for 12% of Russia’s seaborne LNG commerce, International Witness calculates, and was among the many high 5 merchants of Russian-originated LNG that 12 months.

In March 2022, within the weeks following the invasion of Ukraine, Shell apologised for getting a cargo of Russian oil, and mentioned it meant to withdraw from Russian oil and fuel.

It mentioned that it will cease shopping for Russian oil, promote its service stations and different companies in Russia,which it has carried out. It has additionally ended its joint ventures with the state vitality large Gazprom.

And it mentioned it will begin a “phased withdrawal from Russian petroleum merchandise, pipeline fuel and LNG”. But it surely warned that it will be a “advanced problem”.

Worker at Shell petrol station in RussiaPicture supply, Getty Photos

Picture caption,

Shell mentioned final 12 months it will shut all its service stations in Russia

Since then, it has saved taking cargoes of LNG from two Russian ports, the one at Yamal and one at Sakhalin within the far east.

Shell was a minority investor within the Sakhalin fuel mission, however deserted that declare in September final 12 months after the Russian authorities transferred its shares to an area enterprise – and since then has taken no fuel from Sakhalin.

But it surely nonetheless honours the contract with the Russian LNG firm Novatek, which obliges it to purchase 900,000 tonnes a 12 months from Yamal till the 2030s, in keeping with the Reuters information company.

Novatek is Russia’s second greatest fuel firm, and the taxes it pays are a big contributor to the Russian authorities’s funds.

What sanctions are being imposed on Russia?Which corporations mentioned they’d pull out of Russia?

Oleg Ustenko, an adviser to the Ukrainian president, mentioned: “It’s fairly easy: by persevering with to commerce in Russian fuel Shell is placing cash into Putin’s pockets and serving to to fund Russia’s brutal aggression towards the folks of Ukraine.

“The huge sums that Shell and the entire oil business have made in Russia needs to be used to assist fund the reconstruction of Ukraine, slightly than lining the pockets of their shareholders.”

A spokesman for Shell mentioned: “Shell has stopped shopping for Russian LNG on the spot market, however nonetheless has some long-term contractual commitments. That is in full compliance with sanctions, relevant legal guidelines and laws of the nations during which we function.

“There’s a dilemma between placing stress on the Russian authorities over its atrocities in Ukraine and guaranteeing secure, safe vitality provides. It’s for governments to resolve on the extremely troublesome trade-offs that have to be made.”

Shell is the world’s largest dealer of LNG, which isn’t topic to European sanctions, making billions of {dollars} in earnings buying and selling oil and fuel final 12 months.

Russia massively decreased its deliveries of fuel by pipeline final 12 months, nevertheless it has elevated the quantity of fuel it provides by ship, together with to Europe.

The UK has not imported any Russian fuel for over a 12 months, whereas EU politicians are attempting to scale back the quantity of Russian LNG the bloc imports. In March, the EU’s Vitality Commissioner Kadri Simson referred to as on nations and corporations to cease shopping for Russian fuel, and to not signal new contracts.

“It’s lengthy overdue that the buying and selling of Russian LNG is checked out with the identical disgust as Russian oil buying and selling. Focusing on Putin’s vitality earnings can’t be about symbolic measures however should concretely put a cease to the massive fossil gasoline sums that cement his energy,” mentioned Jonathan Noronha-Gant, senior campaigner at International Witness.

The France-based vitality firm TotalEnergies is a minority shareholder within the Yamal mission, and was additionally a significant dealer in Russian LNG, the International Witness evaluation reported.

The BBC has approached TotalEnergies for remark.

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