Russia Warns Leaving Foreign Firms May Never Be Allowed Back

April 25, 2014Russiaby EW Content Team

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Foreign companies, particularly those in the oil and gas sector, that leave Russia over Ukraine-related sanctions may never be allowed to make a return, warned a Russian minister on Thursday.

Natural Resources Minister Sergei Donskoy said that while no foreign firms have thus far signaled their intent to withdraw from projects in the country, there would be severe consequences if any company does do so.

"Russia is one of the most promising countries in terms of hydrocarbons production. If some contracts are severed here, then, colleagues, you lose a serious lump of your future pie,” Donskoy said, as cited by Reuters.

"It is obvious that they (companys that leave) won't return in the near future if they sever investment agreements with us, I mean there are consequences as well," he added.

Thus far, Western oil majors, such as BP and Royal Dutch Shell, have indicated that they were planning to stick with their projects in Russia.

BP Chief Executive Bob Dudley visited Moscow earlier this month and said the company was "rock solid" with its Rosneft investment and that it was "business as usual".

A few days later, Shell Chief Executive Ben van Beurden also came to Moscow and told President Vladimir Putin the company was committed to expansion in Russia.

 Russia has signed deals with other international majors including ExxonMobil, Eni and Statoil, mainly relating to projects in the Arctic.

Donskoy said that if companies did decide to "diversify their investments" and pull out of Russian deals, "I am sure others wishing to take their places would be found".

Related: Will Russian Sanctions Compromise Global Energy Security?

Related: Russia’s Finance Minister Warns Of Zero GDP Growth This Year

Related: Moscow Urges Russian Companies To Delist From Overseas Stock Exchanges

Meanwhile, President Vladimir Putin admitted on Thursday that Western sanctions over Ukraine were hurting the Russian economy, though he insisted that the damages were minimal.

"Overall they are causing (damage), because (credit) ratings are being reviewed, loans could become more expensive and so forth. But this is of no critical character," Putin said, as cited by Reuters.