Oil Service Giant Pulls Workers From Russia On Sanctions

International Business Times

Published Sep 30, 2014 09:19AM ET

Updated Sep 30, 2014 09:30AM ET

Oil Service Giant Pulls Workers From Russia On Sanctions

By Maria Gallucci - Western sanctions against Russia’s energy sector are forcing another U.S. oil company to pull its workers from a Russian project. Schlumberger (NYSE:SLB)., the world’s biggest oilfield services provider, said it will withdraw workers who are citizens of the United States and European Union, Bloomberg News reported Tuesday.

The Texas-based company will pull out about 20 mid-level and senior managers, according to two people who asked not to be identified, Bloomberg said. The news comes a day after U.S. oil giant Exxon Mobil Corporation (NYSE:XOM) said it is withdrawing from a joint project with Russia’s state-owned Rosneft (MCX:ROSN) for offshore Arctic drilling because of the sanctions.

Exploration and production companies were expected to spend nearly $52 billion in Russia this year, according to estimates from Barclays PLC and cited by Bloomberg. A large chunk of that money goes to Schlumberger and other service and equipment companies.

The U.S. and EU first targeted Russia’s energy sector in July by banning Western companies from exporting advanced oil technologies to Russia. The country relies heavily on Western aid and expertise to carry out projects in two of its prized sectors: deep-water and Arctic drilling, and shale gas exploration. The sanctions ramped up in August, prohibiting American and European energy companies from working with Russia on future oil and gas developments.

Last month, Schlumberger became the first U.S. energy firm to say that its quarterly earnings will be negatively impacted by the sanctions, Reuters noted.