WASHINGTON (AP) – The Trump administration has denied a request from Exxon Mobil to waive U.S. sanctions against Russia to allow the company to resume oil drilling around the Black Sea.
Treasury Secretary Steven Mnuchin said Friday in a brief statement that the administration “will not be issuing waivers to U.S. companies, including Exxon, authorizing drilling prohibited by current Russian sanctions.”
Exxon did not immediately respond to requests for comment.
The decision comes just two days after it was reported that Exxon was seeking a waiver to resume a joint venture with Rosneft, a Russian state-owned oil company.
Secretary of State Rex Tillerson was Exxon’s CEO before joining President Donald Trump’s cabinet. While at Exxon, he cultivated close ties with Rosneft and Russian officials including President Vladimir Putin, and he spoke against sanctions that were imposed in 2014 in response to Russia’s annexation of the Crimea region of Ukraine.
The sanctions bar U.S. oil companies from transferring to Russia the advanced technology that is used to drill more efficiently offshore and in shale formations. Exxon has said in regulatory filings that the sanctions could lead to losses of up to $1 billion.
Irving, Texas-based Exxon has disclosed receiving three waivers from the sanctions during the Obama administration for limited work with Rosneft. The company applied in 2015 for a waiver to allow Black Sea drilling, according to a person familiar with the matter but who spoke anonymously because the process is confidential.
Exxon’s critics urged the Treasury Department to block more waivers, which they feared would give new momentum to drilling in the environmentally sensitive Russian Arctic.
Shares of Exxon Mobil Corp. were down 21 cents to $80.81 in afternoon trading.