A major Siberian gas project linked to Scotland has been blacklisted by the UK Government as part of new economic sanctions against Russia.
The Ferret revealed last year that US oil firm, Baker Hughes, exported oil and gas drilling equipment from Montrose to Russia three months after Scottish ministers called on businesses to cease trading with the country.
There is no suggestion that Baker Hughes broke the law or any international trade sanctions, but the transaction went ahead in spite of the Scottish Government’s appeal.
One of the world’s largest oil field services firms, Baker Hughes has received £4.9m of taxpayers’ money in grants from Scottish Enterprise. It has 4,000 staff in the UK, and sites in Montrose and Aberdeen.
The buyer of Baker Hughes’ exports was a contractor on the Arctic LNG 2 (liquefied natural gas) project in the western Siberia region of Russia, which is led by a private Russian gas producer called Novatek.
Arctic LNG 2 serves the Asian and European markets and is key to Russia’s energy strategy.
It has now been targeted by UK ministers, however, who announced 50 new sanctions to mark two years since Russia’s invasion of Ukraine. Key sources of Russian revenue impacted by the sanctions included metals, diamonds and energy.
The move has been welcomed by a Ukrainian human rights group which criticised Baker Hughes last year.
The Scottish Government called on businesses to stop trading with Russia on 3 March 2022.
Baker Hughes said it suspended new investments in Russia in March 2022 and followed applicable laws thereafter. The firm said its last shipment from Montrose to Russia was in June 2022.
The Scottish Government threatened to withhold funding to Baker Hughes after The Ferret’s report last year. A small instalment of government funding was due to the company for a training grant – part of a £4.9m package of support for research and development approved in 2018.
If Russia succeeds in maintaining and further expanding its LNG export to world markets, it will provide Russia with additional resources to sustain its war against Ukraine and potentially escalate it towards other countries.
Svitlana Romanko, founder and director of Ukrainian human rights group Razom We Stand.
Announcing the new sanctions on Russia, David Cameron, the UK’s foreign secretary, said: “Our international economic pressure means Russia cannot afford this illegal invasion. Our sanctions are starving Putin of the resources he desperately needs to fund his struggling war. Together, we will not let up in the face of tyranny. We will continue to support Ukraine as it fights for democracy – for as long as it takes.”
A Baker Hughes spokesperson said: “Baker Hughes reiterates the statements made previously that our last shipment out of Montrose was in June 2022, that we are compliant with all applicable sanctions and that the company and Scottish Enterprise remain in close communication and alignment. As stated, Baker Hughes remains steadfast in its condemnation of violence and its grave concern with the war in Ukraine.”
Svitlana Romanko, founder and director of Ukrainian human rights group Razom We Stand, called for an end to all investment in Russian oil and gas companies. She told The Ferret: “LNG exports are a question of urgent importance. That is why we welcome the new sanctions against Russia adopted by the UK in alignment with the US. We hope that governments will act firmly to enforce sanctions against Arctic LNG 2 and contribute to preventing Putin’s pet project from coming to fruition.”
She added: “If Russia succeeds in maintaining and further expanding its LNG export to world markets, it will provide Russia with additional resources to sustain its war against Ukraine and potentially escalate it towards other countries.”
Scottish Enterprise (SE) said it “condemns Russia’s illegal war in Ukraine and moved swiftly to implement the Scottish Government’s position on companies exporting to Russia”. SE is “fully compliant with all of the legal and discretionary measures regarding support for companies which trade with Russia”, a spokesperson said.
They added: “Our due diligence process is designed to uncover any potential breaches and funding is not provided where such breaches are found. At the time of the final payment for the R&D grant, Baker Hughes satisfied this process as no sanctions were in place and so payment was completed as contracted.”
The Scottish Government and Novatek have been asked to comment.
I think the UK/US governments have hit an all time low. They are OK with parts for weapons, weapons and money going to Israel who are currently commiting a genocide against the Palestinians without even one sanction in place yet sanction Russia. Over 30000 innocent Palestinians including over 11000 children slaughtered in 5 months with those alive being deliberately starved to death is an absolute outrage. There are hundreds of trucks full of food, medicines and everything needed to survive waiting at a checkpoint that Netenyahu refuses to let in. They both airdropped some aid into Gaza which is ironic as they still fund the bombs and ammunition Israel uses on the Palestinian people. In an interview Robert Kennedy JR claimed that Zelensky had reached a deal with Putin to end this war and Boris at Bidens bidding went to Ukraine to stop him. That’s maybe something that could be fact checked along with a piece on how much of our taxes are being used to slaughter innocent men, woman and children as the biggest threat to peace just now isn’t Russsia its Netenyahu and his acolytes.