U.S. Denies Exxon Bid for Waiver on Russia Sanctions -- Update
April 21 2017 - 3:19PM
Dow Jones News
By Jay Solomon and Bradley Olson
WASHINGTON -- President Donald Trump has rejected a bid by U.S.
oil giant Exxon Mobil Corp. to resume a Black Sea oil venture with
a sanctioned Russian firm close to the Kremlin, Treasury Secretary
Steven Mnuchin said Friday.
The Wall Street Journal reported on Wednesday that Exxon last
month sought a waiver on Russian sanctions for its oil exploration
venture with PAO Rosneft, the Russian energy conglomerate closely
aligned with President Vladimir Putin. The company had originally
submitted the application in 2015, and revived it in March.
The venture was frozen in 2014 after the Obama administration
placed sanctions on Rosneft and its chief executive officer, Igor
Sechin, in retaliation for Russia's annexation of the Crimea region
of Ukraine.
"In consultation with President Donald J. Trump, the Treasury
Department will not be issuing waivers to U.S. companies, including
Exxon, authorizing drilling prohibited by current Russian
sanctions," Mr. Mnuchin said in a statement.
The Trump administration's decision likely will make it
impossible for Exxon to drill in Russia's Black Sea waters before
its agreement with Rosneft expires at the end of this year. Exxon
has until 2023 to explore some of Russia's arctic waters if
sanctions are lifted, the company has said.
An Exxon spokesman didn't immediately respond to a request for
comment.
News of Exxon's Treasury application drew sharp criticism in
Congress over the past two days. Leading Democrats and Republicans
have said the Trump White House should be increasing sanctions on
Russia for its alleged effort to interfere in last year's U.S.
presidential election, rather than loosening them.
They have also raised concerns the Trump administration could
face a conflict of interest in ruling on the Exxon application,
given Secretary of State Rex Tillerson's previous position as the
company's chief executive officer. State Department officials have
said this week that Mr. Tillerson has recused himself from any
issues related to Exxon for two years.
"Given Russia's well-documented and troubling activities around
the world, it is troubling Exxon Mobil would continue to press for
its narrow economic advantage at the expense of our national
interests," Sen. Ben Cardin of Maryland, the ranking Democrat on
the Senate Foreign Relations Committee, said on Friday. "The deals
they are seeking would put money in the pockets of Russian
oligarchs and the Russian treasury, guaranteed to be used against
America, our interests, and our allies."
Republican Sen. Marco Rubio of Florida told the Journal on
Thursday: "While a waiver to allow business with prohibited Russian
entities may be in Exxon Mobil's interest, it would clearly not be
in America's national security interest."
--Felicia Schwartz contributed to this article.
Write to Jay Solomon at jay.solomon@wsj.com and Bradley Olson at
Bradley.Olson@wsj.com
(END) Dow Jones Newswires
April 21, 2017 15:04 ET (19:04 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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