France’s Total said Tuesday it will suspend its shale exploration joint venture with Russia’s Lukoil to comply with EU and U.S. sanctions against Russia.
The joint venture was formed in 2014 to explore shale oil prospects in the Bazhenov play in western Siberia.
Drilling has not started and the suspension will not have any effect on Total’s financial results.
Four licenses covering about 1,042 square miles in Khanty-Mansi Autonomous District were initially planned for exploration.
Seismic acquisition began in 2014 and exploration drilling was projected to start in 2015.
Total contributed its Lyaminskiy 3, Vostochno-Kovenskiy and Tashinskiy licences to the project while Lukoil
contributed its Galyanovsky license.
Total holds a 49 percent stake in the joint venture and Lukoil holds a 51 percent stake.
Total said Monday it expects that its $20 billion Yamal LNG joint venture project with Russia’s Novatek and China’s CNPC will be allowed to continue operations despite the sanctions.
Total is the operator of Yamal with a 20 percent stake. Russia’s Novatek owns the project and holds a 60 percent stake. China’s CNPC holds a 20 percent stake.
Western companies must suspend projects with Russian energy companies including Gazprom, Gazprom Neft, Lukoil, Surgutneftegaz and Rosneft to comply with the latest round of EU and U.S. sanctions against Russia.