TotalEnergies Stays in Russia Despite Condemning Ukraine War

(Bloomberg) -- TotalEnergies SE won't follow its peers in dumping its Russian operations for now, as the French government signaled it's up to the company to decide on its business moves.

The energy producer will no longer provide capital for new projects in Russia, but didn't go as far as other oil majors in responding to political pressure to economically isolate the country. BP Plc and Shell Plc have said they will leave Russia, potentially losing tens of billions of dollars in assets.

The French government is not putting any demands on TotalEnergies, and leaving it to the company to assess the situation in Russia, an official at the finance ministry said Tuesday. That's a sharp contrast to the U.K., where political pressure is resulting in companies ending their operations in the country.

“TotalEnergies condemns Russia's military aggression against Ukraine, which has tragic consequences for the population and threatens Europe,” the company said in a statement on Tuesday. “TotalEnergies is mobilized to provide fuel to the Ukrainian authorities and aid to Ukrainian refugees in Europe.”

The company has operations in Russia representing around $1.5 billion, or 5%, of its total cash flow. It owns roughly a fifth of gas producer Novatek PJSC as well as a large interest in the Yamal LNG project, Russia's biggest producer of liquefied natural gas. It also has a 10% in the future Arctic LNG 2 development.

TotalEnergies said it would comply with any sanctions, which have so far haven't targeted energy supplies.

In just two days, some of Europe's largest energy companies dumped tens of billions of dollars of Russian investments that they had nurtured over decades and shut themselves out of the world's largest energy exporter, probably forever.

Shell's move to exit a stake in the Sakhalin-2 LNG project, an investment that dates back to the Yeltsin era, follows BP's announcement on Sunday that it will walk away from a holding in Russia's state oil producer, Rosneft PJSC. The moves by the British companies -- and from Norway's Equinor ASA -- show just how far some Western powers are willing to go to punish President Vladimir Putin for his invasion of Ukraine.