Rosneft deal to buy India’s Essar Oil doesn’t violate sanctions on Russia: US | business-news | Hindustan Times
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Rosneft deal to buy India’s Essar Oil doesn’t violate sanctions on Russia: US

The United States has imposed sanctions on Russia as a penatly for its agression in Ukraine, including the annexation of Crimea.

business Updated: Oct 20, 2016 23:37 IST
(L-R) Andrei Kostin, chief executive of Russia's bank VTB, Igor Sechin, chief executive of Russia's top oil producer Rosneft, and Ravi Ruia, vice chairman of Essar Group, attend an exchange of agreements event after the India-Russia Annual Summit in Benaulim, Goa, India, October 15, 2016.
(L-R) Andrei Kostin, chief executive of Russia's bank VTB, Igor Sechin, chief executive of Russia's top oil producer Rosneft, and Ravi Ruia, vice chairman of Essar Group, attend an exchange of agreements event after the India-Russia Annual Summit in Benaulim, Goa, India, October 15, 2016. (REUTERS)

A deal by a state-owned Russian oil company Rosneft and others to buy India’s Essar Oil for $12.9 billion does not run afoul of US sanctions on Russia, the State Department said.

“I don’t think we see any violation of any US-EU sanctions stemming from this deal,” Mark Toner, a spokesman for the State Department told reporters in a daily briefing on Tuesday.

The United States has imposed sanctions on Russia as a penatly for its aggression in Ukraine, including the annexation of Crimea.

Under the deal, Rosneft is teaming with a consortium of United Capital Partners (UCP), a Russian private investment group, and global oil trader Trafigura to buy Essar Oil. The oil company assets include a massive 400,000 barrels per day refinery, a port and fuel stations.

The deal was carefully put together to reduce the risk of sanctions. Rosneft will control only 49 percent of Essar with Trafigura and UCP jointly holding another 49 percent. But UCP has said it may sell its stake of the deal in five years, which has raised questions about whether Igor Sechin, a close ally of Russian President Vladimir Putin, would have control over the acquisition.

The deal is expected to be completed in a few months.