Russian Sanctions Threat for North Sea Oil and Gas

15:00     2 March, 2015

The North Sea oil and gas fields assets are currently owned by German company RWE Dea, which is being sold to a group backed by Mikhail Fridman who is a Russian billionaire.

The UK Government is going to block the sale of 12 North Sea oil and gas fields to Mikhail Fridman. The reason is sanctions imposed on Russia as Fridman is a potential target for such a measures. There is also fears that the sanctions can apply to his LetterOne fund as well, BBC reports.

The security of the State for the Department of Energy and Climate Change Ed Davey is responsible for ensuring the continued and safe production of the UK’s petroleum resources. The Secretary of State with the respective companies has raised concerns over the impact of possible future sanctions imposed on LetterOne that may have on the continues operations of these 12 fields. Moreover, it can have also health and environmental risks, gov.uk reports.

In order to escape from the sanctions risk German power Firm RWE declared about the 5 billion euro deal to sell its subsidiary to LetterOne. This is still not the best solution as mentioned above, because LetterOne is also under risk. That is why it is creating a new subsidiary, which will run by Lord Browne.

On the other hand Fridman did sit with crossed hands. He threatened to start legal action against UK government over its attempt to block the acquisition.